As music streaming apps struggle to differentiate, Apple is making concert video a more central part of its strategy with tonight’s big Billie Eilish show at its HQ’s Steve Jobs Theater. The Apple Music Awards concert will be streaming live and then on-demand to Apple Music’s 60 million subscribers. Apple would like to do more of these streamed concerts in the near future.
Beyond the concert streaming, Apple is looking to strengthen its perception as an ally to art and artists. Given Apple Music is just a tiny fraction of the iPhone maker’s massive revenues, it can look overly corporate and capitalistic compared to music-only competitors like Spotify that some see as more aligned with the success of musicians.
To grow its subscriber count amongst serious listeners and earn points with creators, Apple Music can’t look like it’s just designed to sell more Apple hardware. So tonight Apple is hoping to show its respect for artists, handing out its first Apple Music Awards. Billie Eilish has won artist of the year and Songwriter Of The Year (with her brother Finneas), while Lizzo is taking home Breakthrough Artist Of The Year. Additionally, based on Apple Music streaming counts, Eilish’s ‘When We All Fall Asleep, Where Do We Go?” has won Album Of The Year, and Lil Was X’s ‘Old Town Road’ is the Song Of The Year.
The award statues themselves are specially-crafted Apple artifacts, featuring overwrought design like you see in those WWDC videos of robots making gadgets. They start with a single 12-inch disc of nanometer-level flat silicon wafer — the same kind used to power Apple’s iPhones. Copper layers are patterned with ultraviolet lithography to etch connections between the billions of transistors on the wafer. It’s then sliced into hundreds of individual chips and lined up during the months-long process to create a reflective trophy suspended between glass and anodized aluminum. In what’s sure to become a kooky collector’s item, each award is packaged with its own special Apple spirit level and mounting screws for classy installation.
The hope seems to be that both the winners and their fellow artists will come away with the perception that Apple truly cares about music. That, plus Apple Music’s scale, could help convince them to share more links to their songs on the streaming service and feature their profile there ahead of their presences on competing listening apps.
On the concert front, Apple started holding its yearly Apple Music Festival, formerly the iTunes Festival, back in 2007. But after a blow-out 10th year where Apple streamed shows from Britney Spears, Elton John, and Chance the Rapper, it discontinued the event in 2017. Apple Music launched a dedicated Music Videos tab last year, but has done less recently with concert streaming other than a few events with Tyler, The Creator and Shawn Mendes. These concert videos can be tough to find inside Apple Music.
Yet this represents a massive opportunity for Apple. Across music streaming services, catalogs are becoming more uniform, everyone is copying each other’s personalized playlists and discovery mechanisms, and many are embracing radio and podcasts. Meanwhile, paying for exclusive music or whole artists has fallen out of fashion compared to a few years ago. Fragmenting the music catalog is hostile towards listeners, can be harmful for artists who lose out on mass distribution, and it can engender backlash from artists fans’ who don’t want to pay for multiple redundant streaming services.
Streaming concert videos, which typically aren’t available beyond shaky camera phone footage, feel additive to the music ecosystem. If platforms are willing to pay to shoot and produce the videos, they can be powerful differentiators. And if the recorded shows look unique from the typical tours, as with the tree-covered stage for tonight’s Billie Eilish show at Apple headquarters, they keep fans glued to their screens. Video viewing can lead users to develop more affinity for whichever company is broadcasting the shows compared to multi-tasking while they merely listen to a generic app.
Apple is already ahead of competitors like Spotify that do very little on the concert video front. Streaming more shows like tonight’s could help it better rival YouTube Music, which integrates traditional music streaming with a broad array of rarities, music videos, and streamed concerts like Coachella. Apple is also fortunate to have a global retail and office footprint that could help it throw and record more shows with fewer logistical headaches.
To date, Apple Music has leaned on its pre-installations on the company’s phones, tablets, and computers plus its free trial system to drive growth. But if it can spot holes in the industry’s content offering, leverage its deep pockets to invest in premium video, and prove to artists that it cares, Apple Music could build a brand separate from and with more street cred than Apple itself.
These ten enterprise M&A deals totaled over $40B in 2019
It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion. This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would…
It would be hard to top the 2018 enterprise M&A total of a whopping $87 billion, and predictably this year didn’t come close. In fact, the top 10 enterprise M&A deals in 2019 were less than half last year’s, totaling $40.6 billion.
This year’s biggest purchase was Salesforce buying Tableau for $15.7 billion, which would have been good for third place last year behind IBM’s mega deal plucking Red Hat for $34 billion and Broadcom grabbing CA Technologies for $18.8 billion.
Contributing to this year’s quieter activity was the fact that several typically acquisitive companies — Adobe, Oracle and IBM — stayed mostly on the sidelines after big investments last year. It’s not unusual for companies to take a go-slow approach after a big expenditure year. Adobe and Oracle bought just two companies each with neither revealing the prices. IBM didn’t buy any.
Microsoft didn’t show up on this year’s list either, but still managed to pick up eight new companies. It was just that none was large enough to make the list (or even for them to publicly reveal the prices). When a publicly traded company doesn’t reveal the price, it usually means that it didn’t reach the threshold of being material to the company’s results.
As always, just because you buy it doesn’t mean it’s always going to integrate smoothly or well, and we won’t know about the success or failure of these transactions for some years to come. For now, we can only look at the deals themselves.
Jumia, DHL, and Alibaba will face off in African ecommerce 2.0
The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom. Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition. To date, scaling e-commerce in Africa has straddled the line of challenge and…
The business of selling consumer goods and services online is a relatively young endeavor across Africa, but ecommerce is set to boom.
Over the last eight years, the sector has seen its first phase of big VC fundings, startup duels and attrition.
To date, scaling e-commerce in Africa has straddled the line of challenge and opportunity, perhaps more than any other market in the world. Across major African economies, many of the requisites for online retail — internet access, digital payment adoption, and 3PL delivery options — have been severely lacking.
Still, startups jumped into this market for the chance to digitize a share of Africa’s fast growing consumer spending, expected to top $2 billion by 2025.
African e-commerce 2.0 will include some old and new players, play out across more countries, place more priority on internet services, and see the entry of China.
But before highlighting several things to look out for in the future of digital-retail on the continent, a look back is beneficial.
Jumia vs. Konga
The early years for development of African online shopping largely played out in Nigeria (and to some extent South Africa). Anyone who visited Nigeria from 2012 to 2016 likely saw evidence of one of the continent’s early e-commerce showdowns. Nigeria had its own Coke vs. Pepsi-like duel — a race between ventures Konga and Jumia to out-advertise and out-discount each other in a quest to scale online shopping in Africa’s largest economy and most populous nation.
Traveling in Lagos traffic, large billboards for each startup faced off across the skyline, as their delivery motorcycles buzzed between stopped cars.
Covering each company early on, it appeared a battle of VC attrition. The challenge: who could continue to raise enough capital to absorb the losses of simultaneously capturing and creating an e-commerce market in notoriously difficult conditions.
In addition to the aforementioned challenges, Nigeria also had (and continues to have) shoddy electricity.
Both Konga — founded by Nigerian Sim Shagaya — and Jumia — originally founded by two Nigerians and two Frenchman — were forced to burn capital building fulfillment operations most e-commerce startups source to third parties.
That included their own delivery and payment services (KongaPay and JumiaPay). In addition to sales of goods from mobile-phones to diapers, both startups also began experimenting with verticals for internet based services, such as food-delivery and classifieds.
While Jumia and Konga were competing in Nigeria, there was another VC driven race for e-commerce playing out in South Africa — the continent’s second largest and most advanced economy.
E-tailers Takealot and Kalahari had been jockeying for market share since 2011 after raising capital in the hundreds of millions of dollars from investors Naspers and U.S. fund Tiger Global Management.
So how did things turn out in West and Southern Africa? In 2014, the lead investor of a flailing Kalahari — Naspers — facilitated a merger with Takealot (that was more of an acquisition). They nixed the Kalahari brand in 2016 and bought out Takelot’s largest investor, Tiger Global, in 2018. Takealot is now South Africa’s leading e-commerce site by market share, but only operates in one country.
In Nigeria, by 2016 Jumia had outpaced its rival Konga in Alexa ratings (6 vs 14), while out-raising Konga (with backing of Goldman Sachs) to become Africa’s first VC backed, startup unicorn. By early 2018, Konga was purchased in a distressed acquisition and faded away as a competitor to Jumia.
Jumia went on to expand online goods and services verticals into 14 Africa countries (though it recently exited a few) and in April 2019 raised over $200 million in an NYSE IPO — the first on a major exchange for a VC-backed startup operating in Africa.
Jumia’s had bumpy road since going public — losing significant share-value after a short-sell attack earlier in 2019 — but the continent’s leading e-commerce company still has heap of capital and generates $100 million in revenues (even with losses).
Airbnb’s New Year’s Eve guest volume shows its falling growth rate
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between. It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in…
Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
It’s finally 2020, the year that should bring us a direct listing from home-sharing giant Airbnb, a technology company valued at tens of billions of dollars. The company’s flotation will be a key event in this coming year’s technology exit market. Expect the NYSE and Nasdaq to compete for the listing, bankers to queue to take part, and endless media coverage.
Given that that’s ahead, we’re going to take periodic looks at Airbnb as we tick closer to its eventual public market debut. And that means that this morning we’re looking back through time to see how fast the company has grown by using a quirky data point.
Airbnb releases a regular tally of its expected “guest stays” for New Year’s Eve each year, including 2019. We can therefore look back in time, tracking how quickly (or not) Airbnb’s New Year Eve guest tally has risen. This exercise will provide a loose, but fun proxy for the company’s growth as a whole.
Before we look into the figures themselves, keep in mind that we are looking at a guest figure which is at best a proxy for revenue. We don’t know the revenue mix of the guest stays, for example, meaning that Airbnb could have seen a 10% drop in per-guest revenue this New Year’s Eve — even with more guest stays — and we’d have no idea.
So, the cliche about grains of salt and taking, please.
But as more guests tends to mean more rentals which points towards more revenue, the New Year’s Eve figures are useful as we work to understand how quickly Airbnb is growing now compared to how fast it grew in the past. The faster the company is expanding today, the more it’s worth. And given recent news that the company has ditched profitability in favor of boosting its sales and marketing spend (leading to sharp, regular deficits in its quarterly results), how fast Airbnb can grow through higher spend is a key question for the highly-backed, San Francisco-based private company.
- 2009: 1,400
- 2010: 6,000 (+329%)
- 2011: 3,1000 (+417%)
- 2012: 108,000 (248%)
- 2013: 250,000 (+131%)
- 2014: 540,000 (+116%)
- 2015: 1,100,000 (+104%)
- 2016: 2,000,000 (+82%)
- 2017: 3,000,000 (+50%)
- 2018: 3,700,000 (+23%)
- 2019: 4,500,000 (+22%)
In chart form, that looks like this:
Let’s talk about a few things that stand out. First is that the company’s growth rate managed to stay over 100% for as long as it did. In case you’re a SaaS fan, what Airbnb pulled off in its early years (again, using this fun proxy for revenue growth) was far better than a triple-triple-double-double-double.
Next, the company’s growth rate in percentage terms has slowed dramatically, including in 2019. At the same time the firm managed to re-accelerate its gross guest growth in 2019. In numerical terms, Airbnb added 1,000,000 New Year’s Eve guest stays in 2017, 700,000 in 2018, and 800,000 in 2019. So 2019’s gross adds was not a record, but it was a better result than its year-ago tally.
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