Trends in Consumer Digital Technology for 2019

For the past few years I’ve got into the habit of start­ing the new year with an arti­cle con­sol­i­dat­ing my thoughts on where we’re at with con­sumer dig­i­tal tech­nol­o­gy; look­ing at the land­scape, and at what the biggest play­ers are doing—my focus is most­ly on Ama­zon, Apple, Face­book, and Google, but it’s not exclu­sive­ly on them. I want to tease out a few trends to help ori­ent myself in my role for the year ahead. I try not to make pre­dic­tions, but per­haps play out some pos­si­bil­i­ties.

There are two big declines at the core of this year’s trends, which I think set the tone for where con­sumer tech might head in 2019. They are the smart­phone decline, and the Face­book decline.

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Google might be taking another tilt at messaging

I have a the­o­ry. Yes, anoth­er one. This time it’s about Google, and how I think they’re tak­ing anoth­er bite at the mes­sag­ing apple. And if I’m right, I think they have a bet­ter chance of suc­cess than pre­vi­ous efforts.

tl;dr: I think Google are going to use some of their biggest exist­ing prop­er­ties to launch their third wave of mes­sag­ing.

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Data use and privacy in Web services

Tim Cook recent­ly made a speech attack­ing Sil­i­con Val­ley com­pa­nies (e.g. Google and Face­book) for mak­ing mon­ey by sell­ing their users’ pri­va­cy. The prob­lem with what he said is that, first of all, it’s fun­da­men­tal­ly incor­rect. As Ben Thomp­son points out (sub­scrip­tion required):

It’s sim­ply not true to say that Google or Face­book are sell­ing off your data. Google and Face­book do know a lot about indi­vid­u­als, but adver­tis­ers don’t know any­thing — that’s why Google and Face­book can charge a pre­mi­um! [They] are high­ly moti­vat­ed to pro­tect user data — their com­pet­i­tive advan­tage in adver­tis­ing is that they have data on cus­tomers that no one else has.

Cen­ny­dd Bowles also argues the same point:

The “you are the prod­uct” thing is pure slo­ga­neer­ing. It sounds con­vinc­ing on first prin­ci­ples but doesn’t hold up to analy­sis. It’s essen­tial­ly say­ing all two-sided plat­forms are immoral, which is daft.

The @StartupLJackson Twit­ter account puts this more plain­ly:

Peo­ple who argue free-to-cus­­tomer data com­pa­nies (FB/Goog/etc) are sell­ing data & hurt­ing con­sumers are the anti-vaxxers of our indus­try.

I’ve always main­tained that this is about a val­ue exchange — you can use my data, as long as I get con­trol and trans­paren­cy over who sees it, and a use­ful ser­vice in return. But beyond that, anoth­er prob­lem with mak­ing pre­mi­um ser­vices where you pay for pri­va­cy is that you make a two-tier sys­tem. Cen­ny­dd again:

The sup­po­si­tion that only a con­­sumer-fund­ed mod­el is eth­i­cal­ly sound is itself polit­i­cal and exclu­sion­ary (of the poor, chil­dren, etc).

And Kate Craw­ford:

Two-tier social media: the rich pay to opt out of Face­book ads, the poor get tar­get­ed end­less­ly. Pri­va­cy becomes a lux­u­ry good.

Aside: Of course this suits Apple, as if wealth­i­er clients can afford to opt out of adver­tis­ing, then adver­tis­ing itself becomes less valu­able — as do, in turn, Google and Face­book.

The fact that peo­ple are will­ing to enter into a data exchange which ben­e­fits them when they get good ser­vices in return high­lights the sec­ond prob­lem with Tim Cook’s attack: Apple are cur­rent­ly fail­ing to pro­vide good ser­vices. As Thomas Rick­er says in his snap­pi­­ly-titled Tim Cook brings a knife to a cloud fight:

Fact is, Apple is behind on web ser­vices. Arguably, Google Maps is bet­ter than Apple Maps, Gmail is bet­ter than Apple Mail, Google Dri­ve is bet­ter than iCloud, Google Docs is bet­ter than iWork, and Google Pho­tos can “sur­prise and delight” bet­ter than Apple Pho­tos.

And even staunch Apple defend­er Jon Gru­ber agreed:

Apple needs to pro­vide best-of-breed ser­vices and pri­va­cy, not sec­ond-best-but-more-pri­­vate ser­vices. Many peo­ple will and do choose con­ve­nience and reli­a­bil­i­ty over pri­va­cy. Apple’s supe­ri­or posi­tion on pri­va­cy needs to be the icing on the cake, not their pri­ma­ry sell­ing point.

As this piece by Jay Yarow for Busi­ness Insid­er points out, in the age of machine learn­ing, more data makes bet­ter ser­vices. Face­book and Google are ahead in ser­vices because they make prod­ucts that under­stand their users bet­ter than Apple do.

Small Numbers, Huge Changes

In a recent inter­view, Sun­dar Pichai of Google dis­cuss­es improve­ments in the accu­ra­cy of their voice recog­ni­tion:

Just in the last three years, we have tak­en things like error in word recog­ni­tion down from about 23 per­cent to 8 per­cent.

That’s the dif­fer­ence between mis­un­der­stand­ing one word in four, to one word in twelve; the dif­fer­ence between com­plete­ly unus­able, and annoy­ing.

Andew Ng, for­mer­ly of Google and now of Baidu, expands on this:

Most peo­ple don’t under­stand the dif­fer­ence between 95 and 99 per­cent accu­rate. Nine­­ty-five per­cent means you get one-in-20 words wrong. That’s just annoy­ing, it’s painful to go back and cor­rect it on your cell phone.

Nine­­ty-nine per­cent is game chang­ing. If there’s 99 per­cent, it becomes reli­able. It just works and you use it all the time. So this is not just a four per­cent incre­men­tal improve­ment, this is the dif­fer­ence between peo­ple rarely using it and peo­ple using it all the time.

It’s fas­ci­nat­ing to see how these small num­bers make a huge dif­fer­ence; you might think Google’s 92% accu­rate is only a lit­tle less than Baidu’s 95% accu­rate, but in prac­ti­cal terms there’s a big gulf. And it gives me pause to think about the mon­ey, human resource and com­put­ing pow­er spent on try­ing to make those small huge increas­es in accu­ra­cy.