Month: August 2018

Facebook announced today the winners of its annual Internet Defense Prize and awarded first-, second- and third-place winners a total of $200,000 for research papers that addressed topics of internet security and privacy. Combined with $800,000 in Secure the Internet Grants awarded to security and privacy researchers earlier this week, the company has now completed its 2018 goal to invest $1 million toward securing the internet.

The Internet Defense Prize first started in 2014, but this year the prize quadrupled from its original $50,000 award to $200,000 spread across three groups. In a statement announcing the winners, Facebook said that the increase of this year’s prize money reflected not just the company’s ongoing (and in light of the its privacy catastrophes this year, seemingly increased) interest in security and privacy, but also the quality of work submitted.

“Over the years we’ve gotten higher and higher quality of submissions,” Pete Voss, Facebook’s Security Communications Manager told TechCrunch. “[But] the criteria has always been the same, and that’s making practical research. Making this go beyond theory and making it so you can actually apply security in real life.”

The first prize, $100,000, was taken home by a team from Belgium for a paper entitled “Who Left Open the Cookie Jar? A Comprehensive Evaluation of Third-Party Cookie Policies” that proposed improvements to browser security that would make users less susceptible to having their internet trail tracked from site to site.

Second- and third-place prizes (for $60,000 and $40,000 each) were awarded to research teams in the U.S. and China, respectively, for papers focusing on proper use of cryptography for app development and for strengthening the algorithm behind single sign-on security systems.

Voss says the entries this year are a great example of the award’s mission to fund research that benefits not just Facebook’s interests in security and privacy, but the internet’s as a whole.

“We’re investing in not just Facebook security but in public security for the entire internet,” said Voss. “We want to keep the internet strong and the only way we can do that is by making it secure.”

As for the recipients of the Secure the Internet Grants, the $800,000 was divided between 10 teams whose research ranged from sociological approaches (like “Understanding the Use of Hijacked Facebook Accounts in the Wild” and “Enhancing Online & Offline Safety During Internet Disruptions in Times of War”) to more technical ones like improving the strength of encryption methods.

Voss told TechCrunch that Facebook has no plans to announce at this time regarding its next steps toward providing funding for researchers in this space (unlike last summer when the company laid out its $1 million goal), but says that the company is “always looking at incentivizing this kind of research” and providing support.

Just a few months back, Niantic added its first “Special Research” to Pokémon GO. Sort of like an in-game quest, the research had players complete a series of tasks (often over a number of days) to unlock an otherwise unobtainable Pokémon.

Now they’re back with another one.

The company will be adding a second Special Research quest to the game on August 20th. Whereas the last set unlocked Mew from the first generation of Pokémon games, this one brings out Gen II’s Celebi.

This technically isn’t the first time Celebi has appeared in GO – attendees of GO Fest back in July got an early crack at a Special Research quest specifically tailored to the event, with the final reward being the opportunity to catch Celebi a solid month before anyone else.

Though a bummer to anyone who couldn’t make it to Chicago, it was a fitting way to debut Celebi. Celebi has almost always been an “event” Pokemon in the original series, meaning you had to do something special to encounter one. Depending on the game, sometimes that meant going to a physical, real world event; sometimes it just meant having the right pre-order disc.

Those who already did the GO Fest research will also be able to do this public run of the Special Research, earning a bit more candy for the Celebi they’ve already caught.

And if you haven’t finished the first (Mew) Special Research yet? That’s okay – they can run in parallel.

These Special Research quests are a clever way for Niantic to keep things interesting. It turns the process of catching one particularly worthwhile Pokémon from something that might take 10 seconds into something that might spread into hours or days (depending on how intense you get about it.) I just wish there were more of them (even if they were only for big lumps of XP). Though it’s smart for Niantic to keep them rare and special, these multi-stage tasks are a bit more rewarding than the one-off quick tasks you get anytime you spin a Pokéstop.

AR/VR/XR are going to be big, but not everyone will win. Today’s market is a collection of related point solutions to specific problems, but not a fully functioning ecosystem. Not yet. For the market to begin to challenge incumbent platforms (particularly mobile), great tech alone is not enough. AR/VR/XR needs its own Reality Ecosystem. And there are a lot of pieces to the puzzle.

(Note: This discussion focuses on consumer, not enterprise, AR/VR/XR markets)

Active users

For platforms to be platforms, they need active users. Lots of them. Table stakes are tens of millions; hundreds of millions are better, but billions are the ultimate goal. Today we’re all active users of a platform with four and a half billion active users — mobile.

Early indications are positive for mobile AR, with Pokémon GO (tens of millions), Snapchat (hundreds of millions) and WeChat (billions) showing what is possible. Google’s Maps/Lens combo demoed at Google I/O also has potential. But it will still take multiple breakouts across the 20-plus mobile AR app categories to leverage early successes into a true platform.

VR has different user dynamics, partly because of a lack of plurality, but also due to relatively limited scale and user attrition. One of the challenges for VR is a primary entertainment focus (games, video), which can be done more easily and cheaply on existing devices (even though they can’t rival it for immersion). Also, the social side of VR hasn’t really scaled so far — AltspaceVR was one of the biggest VR social apps last year with 35,000 monthly active users (“MAU”) when acquired by Microsoft after reporting it was closing. So while there is an active core VR user base, some casual users haven’t stuck with the platform for long enough.

If Apple launches smartphone-tethered smart glasses as an iPhone peripheral (we’ve forecast 2020 for a few years now), we’ll get a better idea of what smart glasses daily active users (“DAU”) could look like. But Snap Spectacles (not smart glasses) and Google Glass highlight that cool tech goggles can end up in the closet. Magic Leap’s recent launch has also received mixed reviews. Smart glasses need to sort this out if they hope to scale.

High-frequency users

The most important economic lesson from mobile is “Frequency ∝ Revenue” (“∝“ means “proportional to”). In other words, high user frequency = money. For example, the top 1 percent grossing mobile apps deliver 35x the sessions per day of the top 5 percent apps. And going back to active users, lifetime value of the top 1 percent grossing apps is 20x that of the the top 5 percent. While it’s obvious, you need to hold on to users and give them something to do to make money. While there are big differences between AR/VR/XR and mobile, this remains a crucial dynamic.

Mobile AR has shown what is possible, with Pokémon GO, Snapchat and soon Google Maps/Lens again standouts. While each has a different approach to user engagement, usage frequency is high. It’s part of why they’re so valuable.

Some VR headsets get used less than once a day, with a significant proportion every few days, weekly or even monthly. Our User Strategy team’s product/market fit reviews for startups have shown this dynamic even when users love their VR apps. The words “evenings,” “weekends” and “holidays” come up, particularly for under-34 Snapchat demographic users. Not ideal for frequency.

Again, with smart glasses it is too early to tell, but app developers might need a mental model closer to mobile than enterprise to get frequency to work. Lightweight, short-duration apps that are opened tens to hundreds of times a day could keep smart glasses on peoples’ faces when they’re ready for prime time. No pressure there, then.

Critical use cases

We think about use cases for new technology platforms in terms of valuable versus critical. Valuable use cases might be cool and technically hard to do, but either don’t fundamentally transform user experience or aren’t important to users. Critical use cases enable lots of users to do something they really care about, and that couldn’t be done in any other way. Critical is interesting, valuable not so much.

Critical use cases for mobile AR are beginning to emerge, with perhaps the first being Google’s Maps/Lens combination revealed at Google I/O 2018. It solves a universal problem when you come out of Embarcadero Station and are told to go south — but where’s south? Google combined computer vision with mobile AR to show you exactly where to go, and even gave you a cute fox to lead you there. This produced a visceral response in the audience at the I/O Keynote, because it solves a problem we all share. And it couldn’t be done in any other way.

VR is valuable — just ask Palmer Luckey. It’s also cool, technically hard to do and can take you to other worlds. But critical? Again, VR’s entertainment focus effectively makes it a subset of the games market, as well as other use cases, such as enterprise training. But critical use cases don’t appear to have emerged three years into the market. For comparison, Uber launched three years after the iPhone.

As smart glasses are largely enterprise focused today, again it’s early for critical consumer use cases. The first could evolve from mobile AR, but they are more likely to come from native smart glasses use cases that only work for that form factor.

Critical apps

On average, Americans tend to use nine mobile apps per day, and 30 per month. Most download zero apps per month. This means critical use cases are not enough. They need to be features of critical apps we already use all the time, or something so insanely great that we might actually download it.

This dynamic could be mobile AR’s secret weapon, with mundane use cases embodied in ubiquitous apps the possible winners. Again, think Google Maps (soon Apple Maps, too) or Snapchat. Outliers like Pokémon GO come from specific sets of circumstances and are hard to duplicate. There’s a reason why breakout hits are rare in mobile (not just mobile AR). Houzz proved mobile AR apps can drive an extraordinary 11x sales uplift for e-commerce, but again, this is a feature of an already successful app. Current mobile leaders could determine how mobile AR evolves even more than startup insurgents.

The challenges for critical VR use cases apply to critical VR apps too. It’s hard to describe a VR app most people couldn’t live without, even if you love Beat Saber. It’s too early to tell with smart glasses again, but their critical use cases might need to be more than ports from breakout mobile AR successes.

Cloud/data

Many people in the industry are excited about AR Cloud, a persistent 3D real-world data layer for shared AR apps. It could become a key enabler for the Reality Ecosystem for both mobile AR and smart glasses. But discussions with AR Cloud startup CEOs indicate that critical use cases and monetization remain open questions for some. Google, Niantic (and again, Apple) have it figured out, but startups in the space must avoid phase 2 of the Underpants Gnomes’ business model. Google and Uber are proof that platform economics can take time to develop, so the excitement may yet be warranted.

Blockchain has been said to be VR’s cloud. While this could be the future, it needs to avoid what Steve Wozniak and others have called the “Blockchain Bubble.”

Data/analytics to support the industry have largely come from industry reports so far (including our own). But AR/VR/XR tools equivalent to Bloomberg, AppAnnie or PitchBook hadn’t emerged before Digi-Capital’s Analytics Platform was first seen at Google in May (before launching in July). Piper Jaffray Apple analyst (now Loup Ventures managing partner) Gene Munster describes it as “Bloomberg for AR/VR/XR” — so hopefully that helps fill the vacuum.

Installed base

For the Reality Ecosystem to succeed, massive installed bases for underlying hardware and software platforms are required. While this does not guarantee users downloading or using AR/VR/XR apps, without them, there’s little chance of success.

Mobile AR is the front-runner, as Apple ARKit, Google ARCore and Facebook Camera Effects could deliver more than 900 million installed base by the end of this year, and approach three and a half billion by 2022. So while mobile AR has a lot of other challenges to solve (not least UI/UX), installed base appears to be a done deal.

VR (mobile, console/PC, standalone) could reach 50 to 60 million installed base in five years’ time, but again, looks more like a subset of the games market than anything else.

Smart glasses could produce tens of millions installed base by 2022 (again, if and when Apple enters), and result in a combined AR/VR headset installed base in the high tens of millions to more than 100 million in five years (or around 3 percent of mobile AR).

Critical hardware

Today’s critical hardware is the smartphone. It’s the first, most frequent and last thing most of us look at every day. So mobile AR has critical hardware already. And if we’re right about Apple rolling out TrueDepth sensors beyond the iPhone X, functionality could get better for a broader set of users.

VR hardware is valuable, but its usage patterns don’t make it look critical yet. Again, as a subset of the games market, it seems to have found a deep niche audience without going mass-market.

Smart glasses need an Apple-quality device (whether made by Apple or somebody else) to be critical. They could start as mobile peripherals, but a device capable of replacing your phone might be what’s needed. However there are major technical and packaging issues to solve first, so this could take a few years.

Corporate and VC investment

The Reality Ecosystem could depend more on internal corporate investment than startups raising cash from VCs. For example, Apple’s investment over the last four years to build its AR Cloud for Apple Maps (and a range of other potential applications) could be greater than the largest VC investments. While attention has been focused on monster rounds for Magic Leap and others, the corporate world could prove more important.

However, VC investment will always be a major driver because it enables black swans like Google, Facebook, Uber, Tencent and Alibaba to emerge. They would not have reached escape velocity without great VCs bankrolling them, and the Reality Ecosystem should be no different.

Talking with 30 leading VCs in Sand Hill Road and China showed a mental model geared toward mobile AR and computer vision in the near-term, and smart glasses in the long-term. VCs appear to be far less focused on VR.

While AR/VR/XR saw more than $1.5 billion investment in Q2 2018 and more than $5 billion in the last 12 months, the shape of the VC market has changed. The shift to China (which could win AR/VR/XR long-term) with larger, later-stage deals, was twinned with fewer early-stage deals in the U.S. in Q2 2018. It will be interesting to see how this plays out through the year.

If you build it, they will come… but who will build it?

Ubiquitous AR (mobile AR, smart glasses) could drive $85 billion to $90 billion revenue by 2022, dominating focused VR (mobile, console/PC, standalone) with $10 billion to $15 billion in the same time frame. But this won’t happen without a robust Reality Ecosystem to support it.

So who will build it?

Digi-Capital tracks thousands AR/VR/XR leaders across mobile AR (gathering momentum, but more traction needed), smart glasses (too early to tell) and VR (still all to prove, three years in). While there are extraordinary startups like Niantic, some of the smart money is on incumbent platforms like Apple, Google, Facebook, Tencent, Alibaba and Amazon to form the bedrock of what is yet to come. None has emerged as the Reality Ecosystem’s true champion yet, so it’s all to play for. That said, Apple’s full-stack ecosystem, Google’s AR Cloud, Facebook’s social scale and Alibaba’s Online-to-Offline (“O2O”) dominance position them as strong contenders.

There’s clear blue ocean between here and the end-game for the Reality Ecosystem, and a massive amount of work to be done. A fair wind and following seas could help, but luck and determination might turn out to be far more important.

Netflix just announced a multi-year deal with Kenya Barris, creator of Black-ish and its spinoff Grown-ish.

While Barris will remain an executive producer on those shows (and on the upcoming Besties), he will be exclusively developing new series for Netflix.

The deal only covers TV, as Barris (who was one of the writers of Girls Trip) has a first-look movie deal at Fox. That’s according to The Hollywood Reporter, which also cites sources who say the deal is for three years and is in the “high-eight-figure range.”

“When my agents reached out to me about this little garage start-up called Netflix, I wasn’t sure what to think,” Barris said in a statement. “But after I talked to [Netflix executives Ted Sarandos and Cindy Holland], I started to believe that maybe this mom-and-pop shop with only 130 million subscribers might just be something… so I decided to take a swing… a leap of faith if you will, and take a chance with the new kids on the block.”

In the past year, Netflix shook up the television industry by signing big deals with Shonda Rhimes and Ryan Murphy — Rhimes’ deal was reportedly worth $100 million, while Murphy’s was for $300 million.

In each case, Netflix isn’t just betting on one big show. Rhimes and her production company Shondaland, for example, recently announced seven projects in development for the streaming service.

The number of U.S. households watching streaming TV services – those that deliver cable TV-like programming over the internet – has grown a remarkable 58% over last year, according to new data from comScore. However, these services still account for a small portion of the overall market, as only 5 percent (4.9 million) of U.S. households with Wi-Fi streamed TV over one of these services in April 2018.

In citing that number, comScore was specifically looking at what it called “pure-play” vMVPDs (virtual multichannel video programming distributors) – a variation on a fancy industry term that refers to live TV services like Sling TV. These services stream multiple channels over the internet without supplying infrastructure like coax cable to do so, and don’t offer other content like original programming or user videos.

Today’s lineup of these “vMVPDs” includes: Sling TV, DirecTV Now, Playstation Vue, fuboTV, Philo, YouTube TV, and Hulu with Live TV. These “pure-play vMVPDs,” as comScore referred to them, are basically that same list, excluding Hulu Live and YouTube TV, as those also include access to non-linear, digital-only content like original programming.

The firm found that consumer adoption of these “pure-play” live TV services is growing significantly, as more people cut the cord with traditional pay TV.

For example, these “pure-play” streaming services accounted for 10% of all the time spent streaming shows and movies over-the-top during the month of April 2018. That’s up 53% from last year.

And in households where one of these live TV services is present, nearly half the time that household spends streaming programming over-the-top is via that service.

Also interesting is the fact that, unlike with a lot of new technology, these live TV services aren’t just being adopted by younger demographics.

In April 2017, 29% of U.S. households using one of these service had a head of the household who was under the age of 35. In a year’s time. that percentage dropped 8 points to 21%, which indicates there are more older viewers now signing up.

Another finding from the report is that the live TV services are coming into households that are already doing a ton of over-the-top streaming.

In April 2018, these households streamed an average of 128 hours of over-the-top content. That’s far more than the average of 54 hours. Around half the hours they spent was on streaming live TV, and the other half is streaming from other services, like video-on-demand services such as Netflix or Amazon Prime Video.

comScore estimates these live TV services will continue to grow in the months ahead, and even forecast that newcomers like Hulu Live and YouTube TV to well exceed a million users each sometime this year.

That would put all the vMVPDs at more than 7 million total users – or nearly one-third the number of households with satellite TV.

Inokyo wants to be the indie Amazon Go. It’s just launched its prototype cashierless autonomous retail store. Cameras track what you grab from shelves, and with a single QR scan of its app on your way in and out of the store, you’re charged for what you got.

Inokyo‘s first store is now open on Mountain View’s Castro Street selling an array of bougie kombuchas, snacks, protein powders, and bath products. It’s sparse and a bit confusing, but offers a glimpse of what might be a commonplace shopping experience five years from now. You can get a glimpse yourself in our demo video below:

“Cashierless stores will have the same level of impact on retail as self-driving cars will have on transportation” Inokyo co-founder Tony Francis tells me. “This is the future of retail. It’s inevitable that stores will become increasingly autonomous.”

Inokyo (rhymes with Tokyo) is now accepting signups for beta customers who want early access to its Mountain View store. The goal is to collect enough data to dictate the future product array and business model. Inokyo is deciding whether it wants to sell its technology as a service to other retail stores, run its own stores, or work with brands to improve their product’s positioning based on in-store sensor data on custom behavior.

“We knew that building this technology in a lab somewhere wouldn’t yield a successful product” says Francis. “Our hypothesis here is that whoever ships first, learns in the real world, and iterates the fastest on this technology will be the ones to make these stores ubiquitous.” Inokyo might never rise into a retail giant ready to compete with Amazon and Whole Foods. But its tech could even the playing field, equipping smaller businesses with the tools to keep tech giants from having a monopoly on autonomous shopping experiences.

It’s About What Cashiers Do Instead

“Amazon isn’t as ahead as we assumed” Francis remarks. He and his co-founder Rameez Remsudeen took a trip to Seattle to see the Amazon Go store that first traded cashiers for cameras in the US. Still, they realized “This experience can be magical”. The two had met at Carnegie Mellon through machine learning classes before they went on to apply that knowledge at Instaram and Uber. The two decided that if they jumped into autonomous retail soon enough, they could still have a say in shaping its direction.

Next week, Inokyo will graduate from Y Combinator’s accelerator that provided its initial seed funding. In six weeks during the program, they found a retail space on Mountain View’s main drag, studied customer behaviors in traditional stores, built an initial product line, and developed the technology to track what user are taking off the shelves.

Here’s how the Inokyo store works. You download its app and connect a payment method, and you get a QR code that you wave in front of a little sensor as you stroll into the shop. Overhead cameras will scan your body shape and clothing without facial recognition in order to track you as you move around the store. Meanwhile, on-shelf cameras track when products are picked up or put back. Combined, knowing who’s where and what’s grabbed lets it assign the items to your cart. You scan again on your way out, and later you get a receipt detailing the charges.

Originally, Inokyo actually didn’t make you scan on the way out, but it got the feedback that customers were scared they were actually stealing. The scan-out is more about peace of mind than engineering necessity. There is a subversive pleasure to feeling like “well, if Inokyo didn’t catch all the stuff I chose, that’s not my problem.” And if you’re overcharged, there’s an in-app support button for getting a refund.

Inokyo was accurate in what it charged me despite me doing a few switcharoos with products I nabbed. But there were only about three people in the room with at the time. The real test for these kinds of systems are when a rush of customers floods in and that cameras have to differentiate between multiple similar-looking people. Inokyo will likely need to be over 99 percent accurate to be more of a help than a headache. An autonomous store that constantly over- or undercharges would be more trouble than it’s worth, and patrons would just go to the nearest classic shop.

Just because autonomous retail stores will be cashier-less doesn’t mean they’ll have no staff. To maximize cost-cutting, they could just trust that people won’t loot it. However, Inokyo plans to have someone minding the shop to make sure people scan in the first place and to answer questions about the process. But theirs also an opportunity in reassigning labor from being cashiers to concierges that can recommend the best products or find what’s the right fit for the customer. These stores will be judged by the convenience of the holistic experience, not just the tech. At the very least, a single employee might be able to handle restocking, customer support, and store maintenance once freed from cashier duties.

While Amazon Go uses cameras in a similar way to Inokyo, it also relies on weight sensors to track items. There are plenty of other companies chasing the cashierless dream. China’s BingoBox has nearly $100 million in funding and has over 300 stores, though they use less sophisticated RFID tags. Fellow Y Combinator startup Standard Cognition has raised $5 million to equip old school stores with autonomous camera-tech. AiFi does the same, but touts that its cameras can detect abnormal behavior that might signal someone is a shoplifter.

The store of the future seems like more and more of a sure thing. The race’s winner will be determined by who builds the most accurate tracking software, easy-to-install hardware, and pleasant overall shopping flow. If this modular technology can cut costs and lines without alienating customers, we could see our local brick-and-mortars adapt quickly. The bigger question than if or even when this future arrives is what it will mean for the millions of workers who make their living running the checkout lane.

Kids these days take a greater interest in practical things than we give them credit for. For example, this summer my 12-year-old son Leo was at sleepaway camp in Canada. When we received his first letter home, among camp platitudes, the two notable items reported were that one of his counselors was discharged from the Israeli Army a week before camp, while another was recently “mugged by three guys (one had a gun!) and got stabbed in the arm.” Leo reported the cabin was mesmerized when, as a reward, the counselor showed campers his sweater with a knife hole in it.

America’s colleges and universities could learn a thing or two from Leo, because they continue to resist teaching students the practical things they’ll need to know as soon as they graduate; for instance, to get jobs that will allow them to make student loan payments. Digital skills head this list, specifically experience with the high-powered software they’ll be required to use every day in entry-level positions.

But talk to a college president or provost about the importance of Marketo, HubSpot, Pardot, Tableau, Adobe and Autodesk for their graduates, and they’re at a loss for how to integrate last-mile training into their degree programs in order prepare students to work on these essential software platforms.

Enter a new company, Pathstream, which just announced a partnership with tech leader Unity and previously partnered with Facebook. Pathstream supports the delivery of career-critical software skill training in VR/AR and digital marketing at colleges and universities.

According to Pathstream co-founder Eleanor Cooper, the company was created from piecing together two insights. First, graduates aren’t getting the digital skills they need to be hired. Employers are so frustrated that they no longer believe that new grads are qualified for digital jobs; according to a recent survey of more than 95,000 job postings by TalentWorks, 61 percent of positions that say they’re seeking entry-level employees now specify at least three years or more of relevant work experience. Second, tech companies are struggling to reach new generations of learners.

While today’s college graduates are “digital natives,” these natives have been conditioned on Netflix-like interfaces, and aren’t accustomed to laborious software configurations, or the steep learning curves required to master a software platform.

As a result, Cooper says Pathstream makes learning a new software platform live up to student expectations of receiving “joy before pain,” thereby gently nudging college students down the road to mastery. In addition, rather than traditional classroom-based learning, Pathstream’s platform simulates a work environment, where students complete tasks and projects on the platform, build a portfolio of work and earn a certification from both a higher education institution and the software company.

Facebook is using Pathstream to support training students on its digital marketing platform, including social media marketing using Facebook Ad Manager and Instagram . Parisa Zagat, Policy Programs Manager at Facebook, related the partnership with Pathstream to its pledge in June to train 1 million U.S. small business owners on the digital skills they need to compete in today’s workplace.

Unity is focusing its training on VR/AR courses for industry use cases (construction, manufacturing, automotive, enterprise training). Jessica Lindl, Global Head of Education at Unity, said “in order to gain employment in today’s digitally focused world, job-seekers are required to rapidly up-level their skills.”

“The problem is there’s a significant education gap between those who seek to learn these skills and the programs available to them. With Pathstream, we will be able to provide interactive programs for students of all backgrounds to learn real-world software platforms in their own way, making it easier and more efficient for them to find success in their current career path or a new one.”

While it completes training programs for Facebook and Unity, Pathstream is building out a network of colleges that will offer the curriculum to students. Recently, Facebook announced that Pathstream will be offering digital marketing certificates at Central New Mexico Community College and Des Moines Area Community College. According to Zagat, “By the end of the year, Facebook plans to form a total of 20 partnerships with community colleges across the country, working hand-in-hand with Pathstream and the colleges to build out custom curriculums and programs for these partnerships.”

Cooper says that “colleges and universities understand that their students are focused on employment, and specifically on getting a good first job. Today’s students no longer buy the line that college prepares you for your fifth job, not your first job. They know that if you don’t get a good first job, you’re probably not going to get a good fifth job.” And, as she points out, most good first jobs specifically require one or more technologies like Facebook or Unity — technologies that colleges and universities aren’t teaching.

If Pathstream is able to realize its vision of integrating industry-relevant software training into degree programs in a big way, colleges and universities have a shot at maintaining their stranglehold as the sole pathway to successful careers. If Pathstream’s impact is more limited, watch for millions of students to sidestep traditional colleges, and enroll in emerging faster and cheaper alternative pathways to good first jobs — alternative pathways that will almost certainly integrate the kind of last-mile training being pioneered by Pathstream.

Work-Bench, a New York City venture capital firm that spends a lot of time around Fortune 1000 companies, has put together The Work-Bench Enterprise Almanac: 2018 Edition, which you could think of as a State of the Enterprise report. It’s somewhat like Mary Meeker’s Internet Trends report, but with a focus on the tools and technologies that will be having a major impact on the enterprise in the coming year.

Perhaps the biggest take-away from the report could be that the end of SaaS as we’ve known could be coming if modern tools make it easier for companies to build software themselves. More on this later.

While the report writers state that their findings are based at least partly on anecdotal evidence, it is clearly an educated set of observations and predictions related to the company’s work with enterprise startups and the large companies they tend to target.

As they wrote in their Medium post launching the report, “Our primary aim is to help founders see the forest from the trees. For Fortune 1000 executives and other players in the ecosystem, it will help cut through the noise and marketing hype to see what really matters.” Whether that’s the case will be in the eye of the reader, but it’s a comprehensive attempt to document the state of the enterprise as they see it, and there are not too many who have done that.

The big picture

The report points out the broader landscape in which enterprise companies — startups and established players alike — are operating today. You have traditional tech companies like Cisco and HP, the mega cloud companies like Amazon, Microsoft and Google, the Growth Guard with companies like Snowflake, DataDog and Sumo Logic and the New Guard, those early stage enterprise companies gunning for the more established players.

As the report states, the mega cloud players are having a huge impact on the industry by providing the infrastructure services for startups to launch and grow without worrying about building their own data centers or scaling to meet increasing demand as a company develops.

The mega clouders also scoop up a fair number of startups. Yet they don’t devote quite the level of revenue to M&A as you might think based on how acquisitive the likes of Salesforce, Microsoft and Oracle have tended to be over the years. In fact, in spite of all the action and multi-billion deals we’ve seen, Work-Bench sees room for even more.

It’s worth pointing out that Work-Bench predicts Salesforce itself could become a target for mega cloud M&A action. They are predicting that either Amazon or Microsoft could buy the CRM giant. We saw such speculation several years ago and it turned out that Salesforce was too rich for even these company’s blood. While they may have more cash to spend, the price has probably only gone up as Salesforce acquires more and more companies and its revenue has surpassed $10 billion.

About those mega trends

The report dives into 4 main areas of coverage, none of which are likely to surprise you if you read about the enterprise regularly in this or other publications:

• Machine Learning
• Cloud
• Security
• SaaS

While all of these are really interconnected as SaaS is part of the cloud and all need security and will be (if they aren’t already) taking advantage of machine learning. Work-Bench is not seeing it in such simple terms, of course, diving into each area in detail.

The biggest take-away is perhaps that infrastructure could end up devouring SaaS in the long run. Software as a Service grew out of couple of earlier trends, the first being the rise of the Web as a way to deliver software, then the rise of mobile to move it beyond the desktop. The cloud-mobile connection is well documented and allowed companies like Uber and Airbnb, as just a couple of examples, to flourish by providing scalable infrastructure and a computer in our pockets to access their services whenever we needed them. These companies could never have existed without the combination of cloud-based infrastructure and mobile devices.

End of SaaS dominance?

But today, Work-Bench is saying that we are seeing some other trends that could be tipping the scales back to infrastructure. That includes containers and microservices, serverless, Database as a Service and React for building front ends. Work-Bench argues that if every company is truly a software company, these tools could make it easier for companies to build these kind of services cheaply and easily, and possibly bypass the SaaS vendors.

What’s more, they suggest that if these companies are doing mass customization to these services, then it might make more sense to build instead of buy, at least on one level. In the past, we have seen what happens when companies try to take these kinds of massive software projects on themselves and it hardly ever ended well. They were usually bulky, difficult to update and put the companies behind the curve competitively. Whether simplifying the entire developer tool kit would change that remains to be seen.

They don’t necessarily see companies running wholesale away from SaaS just yet to do this, but they do wonder if developers could push this trend inside of organizations as more tools appear on the landscape to make it easier to build your own.

The remainder of the report goes in depth into each of these trends, and this article just has scratched the surface of the information you’ll find there. The entire report is embedded below.

No surprise that smart speaker sales are on the rise. That certainly comports with recent numbers from NPD. The latest report from Canalys, however, pulls the camera back a bit to give a better picture of the global market. Seems that while smart speaker sales continue to be hot here in the States, they’re positively on fire in China.

Global shipments increased by 187 percent year-over-year for a total of 16.8 million units. China accounted for 52-percent of the total growth worldwide, with Alibaba and Xiaomi accounting for 17.7 and 12.2 percent, respectively. The growth is large, in part, due to the fact that the category effectively didn’t exists a year ago.

Canalys’ Hattie He notes that a confluence of different elements have potentially put the country on track overtake the U.S.

“Alibaba and Xiaomi have both relied on aggressive price cuts to create demand,” He adds. “Both companies have the financial backing to spend on marketing and hardware subsidies in a bid to quickly build their user bases. Although the real level of user demand for speaker products is currently unproven, China is on its way to overtake the US in the near term. The challenge remains for local vendors to increase user stickiness and generate revenue from the growing installed base of smart speaker users.”

Also interesting is the fact that Google has maintained its top spot ahead of Amazon, with explosive growth year over year. Google’s up 449 percent to Amazon’s -14 — putting the two companies in first and second place, respectively. Of course, Amazon got a significant headset in the market, so Google has some ground to make up. Apple, meanwhile, failed to crack the top four.

Facebook’s role in the opioid crisis could become another scandal following yesterday’s release of harrowing new statistics from the Center for Disease Control. It estimated there were nearly 30,000 synthetic opioid overdose deaths in the U.S. in 2017, up from roughly 20,000 the year before. When recreational drugs like Xanax and OxyContin are adulterated with the more powerful synthetic opioid Fentanyl, the misdosage can prove fatal. Xanax, OxyContin and other pain killers are often bought online, with dealers promoting themselves on social media including Facebook.

Hours after the new stats were reported by The New York Times and others, a source spotted that Facebook’s internal search engine stopped returning posts, Pages and Groups for searches of “OxyContin,” “Xanax,” “Fentanyl” and other opioids, as well as other drugs like “LSD.” Only videos, often news reports deploring opiate abuse, and user profiles whose names match the searches, are now returned. This makes it significantly harder for potential buyers or addicts to connect with dealers through Facebook.

However, some dealers have taken to putting drug titles into their Facebook profile names, allowing accounts like “Fentanyl Kingpin Kilo” to continue showing up in search results. It’s not exactly clear when the search changes occurred.

On some search result pages for queries like “buy xanax,” Facebook is now showing a “Can we help?” box that says “If you or someone you know struggles with opioid misuse, we would like to help you find ways to get free and confidential treatment referrals, as well as information about substance use, prevention and recovery.” A “Get support” button opens the site of The Substance Abuse and Mental Health Services Administration, a branch of the U.S. department of health and human services that provides addiction resources. Facebook had promised back in June that this feature was coming.

When asked, Facebook confirmed that it’s recently made it harder to find content that facilitates the sale of opioids on the social network. Facebook tells me it’s constantly updating its approach to thwart bad actors who look for new ways to bypass its safeguards. The company confirms it’s now removing content violating its drug policies, and it’s blocked hundreds of terms associated with drug sales from showing results other than links to news about drug abuse awareness. It’s also removed thousands of terms from being suggested as searches in its typeahead.

Regarding the “Can we help?” box, Facebook tells me this resource will be available on Instagram in the coming weeks, and it provided this statement:

We recently launched the “Get Help Feature” in our Facebook search function that directs people looking for help or attempting to purchase illegal substances to the SAMHSA national helpline. When people search for help with opioid misuse or attempt to buy opioids, they will be prompted with content at the top of the search results page that will ask them if they would like help finding free and confidential treatment referrals. This will then direct them to the SAMHSA National Helpline. We’ve partnered with the Substance Abuse & Mental Health Services Administration to identify these search terms and will continue to review and update to ensure we are showing this information at the most relevant times.

The new actions follow Facebook shutting down some hashtags like “#Fentanyl” on Instagram back in April that could let buyers connect with dealers. That only came after activists like Glassbreakers’ Eileen Carey aggressively criticized the company, demanding change. In some cases, when users would report Facebook Groups’ or Pages’ posts as violating its policy prohibiting the sale of regulated goods like drugs, the posts would be removed, but Facebook would leave up the Pages. This mirrors some of the problems it’s had with Infowars around determining the threshold of posts inciting violence or harassing other users necessary to trigger a Page or profile suspension or deletion.

Before all these changes, users could find tons of vendors illegally selling opioids through posts, photos and Pages on Facebook and Instagram. Facebook also introduced a new ads policy last week requiring addiction treatment centers that want to market to potential patients be certified first to ensure they’re not actually dealers preying on addicts.

Much of the recent criticism facing Facebook has focused on it failing to prevent election interference, privacy scandals and the spread of fake news, plus how hours of browsing its feeds can impact well-being. But its negligence regarding illegal opioid sales has likely contributed to some of the 72,000 drug overdose deaths in America last year. It serves as another example of how Facebook’s fixation on the positive benefits of social networking blinded it to the harsh realities of how its service can be misused.

Last November, Facebook CEO Mark Zuckerberg said that learning of the depths of the opioid crisis was the “biggest surprise” from his listening tour visiting states across the U.S, and that it was “really saddening to see.”

Five months later, Representative David B. McKinley (R-W.VA) grilled Zuckerberg about Facebook’s responsibility surrounding the crisis. “Your platform is still being used to circumvent the law and allow people to buy highly addictive drugs without a prescription” McKinley said during Zuckerberg’s congressional hearings in April. “With all due respect, Facebook is actually enabling an illegal activity, and in so doing, you are hurting people. Would you agree with that statement?” The CEO admitted “there are a number of areas of content that we need to do a better job policing on our service.”

Yet the fact that he called the crisis a “surprise” but failed to take stronger action when some of the drugs causing the epidemic were changing hands via his website is something Facebook hasn’t fully atoned for, nor done enough to stop. The new changes should be the start of a long road to recovery for Facebook itself.