Author: azeeadmin

Commercial human spaceflight company Virgin Galactic has unveiled the first ever Spaceship III, the third major iteration of its spacecraft design. The first in this new series is called ‘VSS (Virgin SpaceShip) Imagine,’ and will start ground testing now with the aim of beginning its first glide flights starting this summer. VSS Imagine has a snazzy new external look, including a mirrored wraparound finish that’s designed to reflect the spacecraft’s changing environment as it makes its way from the ground to space — but more importantly, it moves Virgin Galactic closer to achieving the engineering goals it requires to produce a fleet of spacecraft at scale.

I spoke to Virgin Galactic CEO Michael Colglazier about VSS Imagine, and what it represents for the company.

“We can build these at a faster pace,” he explained. “These are still relatively slow, versus what we want in our next class of spaceships. But what we do expect to have here is, we’ve taken all the learnings from [VSS] Unity, and built-in what we need to do so that we can turn these ships at a faster pace, because obviously, the number of flights we can do is the product of how many ships you have, and how quickly you can turn them.”

Unlike Unity, which is the spacecraft that Virgin Galactic first flew in September 2016, and that it ‘s still using in New Mexico now for its testing and commercial launch preparation program, Imagine has a “modular design” that makes it much easier to maintain, and increases the rate at which it can fly subsequent missions. As Colglazier mentioned, there’s still more work to be done in that regard to get the Spaceship design to the point where it’s able to support the company’s target of around 400 flights per year, per individual spaceport, but it’s a big upgrade, and the company is already beginning manufacturing work on a second Spaceship III-class vehicle, ‘VSS Inspire.’

Image Credits: Virgin Galactic

Imagine and Inspire are technical achievements, to be sure, but Colglazier, who came to Virgin Galactic from Disney Parks International in July 2020, also emphasized the importance of this spacecraft debut in terms of the company’s consumer brand.

“What you’re seeing in the images, the choice of the livery, the film that we’ve put out, is a very clear step, as a consumer brand launch, and as we’re stepping in and building that, that will build over the course of the summer as we build up towards Richard [Branson]’s flight,” he said. “Very purposefully, we’ve used these lofty words of ‘democratizing space’ — but space is meant for everyone. It may take a while, just for everyone to get there, but it’s coming. And so this was leading with a very consumer facing, ‘Why are we doing this?'”

In fact, that focus on the consumer side of the business has been a lot of Colglazier’s work over the past eight months since joining the company. He said that the Virgin Galactic he joined had a “world-class team” that had the aerospace pieces completely locked in, but that his particular contribution has been in building up the commercial side of the business to match.

“We’re now bringing some talent in that is used to scaling this kind of a business, so Swami Iyer actually started Monday of last week,” he said. “And when you see a guy like Joe Rohde, who came in on the experience side, there’s no replacement — that’s additive to building out now the shoulders around this experience.”

Iyer joined as President of Aerospace Systems, and brings years of experience in the commercial space and defense industry, across GKN Advanced Defernce Systems, Honeywell Aerospace and more. Rohde, on the other hand, boasts a very different background, as a longtime Disney Imagineer, who joins the company as its first ‘Experience Architect,’ focused squarely on defining what the Virgin Galactic experience is for its astronaut customers, their friends and family, and the broader public, too.

Colglazier said that their vision for what the experience will look like will also be different depending on what part of the world you’re flying from, noting that weather you fly from a spaceport in Europe, Asia, India or Australia should result in something “dramatically different,” even if the spacecraft themselves are all used in the same way as they are in New Mexico. That definitely seems like a logical approach from an executive whose prior experience includes leading Disney’s parks in Burbank, Paris, Hong Kong, Shanghai and Tokyo.

Image Credits: Virgin Galactic

In the end, Colglazier said that the core philosophy Virgin Galactic will pursue in terms of consumer brand will be one focused on inclusion, even if the actual ‘going to space’ part of its offering remains out of reach for most in the short term.

“This is for everyone, it has to be for everyone,” he said. That aspiration may take some number of years to actually be realized, but in the meantime, we have to find a way that our brand and our company can be accessed, that what we do can be accessed by all sorts of people at all different layers of engagement, so we’re going to be very purposeful about that. You’re going to hear us talking mostly about, effectively the apex experience — actually taking the new ships to space. But the ability to tier down out of that is really, really important, and the ability for us to be a brand that’s reaching out to everyone is incredibly important.”

That begins with the approach to this spacecraft debut today, Colglazier says, and is apparent in the tone of the video the company debuted (embedded above) to mark the reveal. And Virgin Galactic also still has 600 passengers booked and waiting for their own flights, so that’s obviously a key focus after Branson’s flight targeted for later this year.

Finally, I asked Colglazier when he himself intends to go up, since he said he definitely plans to when joining the company. Mostly, he said, he doesn’t want to cut in front of any paying customers.

“Okay, there are 600 or so people that are going to be a little ticked at me, if I jumped the line, so I’m going to keep focused at the consumer level,” he said. “But nobody else is in line yet, so I’m gonna get in before anybody else comes in line.”

As more companies become ever more reliant on digital infrastructure for everyday work, the more they become major targets for malicious hackers — both trends accelerated by the pandemic — and that is leading to an ever-greater need for IT and security departments to find ways of protecting data should it become compromised. Today, one of the companies that has emerged as a strong player in data backup and recovery is announcing its first major round of funding.

HYCU, which provides multi-cloud backup and recovery services for mid-market and enterprise customers, has raised $87.5 million, a Series A that it the Boston-based startup will be using to invest in building out its platform further, to bring its services into more markets, and to hire 100 more people.

HYCU’s premise and ambition, CEO and founder Simon Taylor said in an interview, is to provide backup and storage services that are as simple to use “as backing up in iCloud for consumers.”

“If you look at primary storage, it’s become very SaaS-ifed, with no professional services required,” he continued. “But backup has stayed very legacy. It’s still mostly focused on one specific environment and can’t perform well when multi-cloud is being used.”

And HYCU’s name fits with that ethos. It is pronounced “haiku”, which Taylor told me refers not just to that Japanese poetic form that looks simple but hides a lot of meaning, but also “hybrid cloud uptime.”

The company is probably known best for its integration with Nutanix, but has over time expanded to serve enterprises building and operating IT and apps over VMware, Google Cloud, Azure and AWS. The company also has built a tool to help migrate data for enterprises, HYCU Protégé, which will also be expanded.

The funding is being led by Bain Capital Ventures, with participation also from Acrew Capital (which was also in the news last week as an investor in the $118 million round for Pie Insurance). The valuation is not being disclosed.

This is the first major outside funding that the company has announced since being founded in 2018, but in that time it has grown into a sizeable competitor against others like Rubrik, Veeam, Veritas and CommVault. The Rubrik comparison is interesting, given that it is also backed by Bain (which led a $261 million round in Rubrik in 2019). HYCU now has more than 2,000 customers in 75 countries. Taylor says that not taking funding while growing into what it has become meant that it was “listening and closer to the needs of our customers,” rather than spending more time paying attention to what investors says.

Now that it’s reached a certain scale, though, things appear to be shifting and there will probably be more money down the line. “This is just round one for us,” Taylor said.

He added that this funding came in the wake of a lot of inbound interest that included not just the usual range of VCs and private equity firms that are getting more involved in VC, but also, it turns out, SPACs, which as they grow in number, seem to be exploring what kinds and stages of companies they tap with their quick finance-and-go-public model.

And although HYCU hadn’t been proactively pitching investors for funding, it would have been on their radars. In fact, Bain is a major backer of Nutanix, putting some $750 million into the company last August. There is some strategic sense in supporting businesses that figure strongly in the infrastructure of your other portfolio companies.

There is another important reason for HYCU raising capital to expand beyond what its balance sheet could provide to fuel growth: HYCU’s would-be competition is itself going through a moment of investment and expansion. For example, Veeam, which was acquired by Insight last January for $5 billion, then proceeded to acquire Kasten to move into serving enterprises that used Kubernetes-native workloads across on-premises and cloud environments. And Rubrik last year acquired Igneous to bring management of unstructured data into its purview. And it’s not a given that just because this is a sector seeing a lot of demand, that it’s all smooth sailing. Igneous was on the rocks at the time of its deal, and Rubrik itself had a data leak in 2019, highlighting that even those who are expert in protecting data can run up against problems.

Taylor notes that ransomware indeed remains a very persistent problem for its customers — reflecting what others in the security world have observed — and its approach for now is to remain focused on how it delivers services in an agent-less environment. “We integrate into the platform,” he said. “That is incredibly important. It means that you can be up and running immediately, with no need for professional services to do the integrating, and we also make it a lot harder for criminals because of this.”

Longer term, it will keep its focus on backup and recovery with no immediate plans to move into adjacent areas though such as more security services or other tools. “We’re not trying to be a Veritas and own the entire business end-to-end,” Taylor said. “The goal is to make sure the IT department has visibility and the cloud journey is protected.”

Enrique Salem, a partner at Bain Capital Ventures and the former CEO of Symantec, is joining HYCU’s board with this round and sees the opportunity in the market for a product like HYCU’s.

“We are in the early days of a multi-decade shift to the public cloud, but existing on-premises backup vendors are poorly equipped to enable this transition, creating tremendous opportunity for a new category of cloud-native backup providers,” he said in a statement. “As one of the early players in multi-cloud backup as a service bringing true SaaS to both on-premises and cloud-native environments, HYCU is a clear leader in a space that will continue to create large multi-billion dollar companies.”

Stefan Cohen, a principal at Bain Capital Ventures, will also be joining the board.

Eben Bayer has spent the better part of fourteen years proving out the power of the humble mushroom as the world’s truly functional food. 

As the chief executive and founder of Ecovative Design, Bayer has made replacements for foam packaging, lamps and furniture, leather materials, and even meats like bacon from mighty mushroom mycelia (they even grew a tiny. home).

Now the company has $60 million in financing to create new applications for its mycelial products and scale up existing business units.

The core of Ecovative Design’s business is in packaging. That’s where the company has been developing its tech the longest and where its replacements for styrofoam packaging have had the most commercial traction.

But there’s far more to Ecovative’s mushrooms than that and the company’s new investors including Viking Global Investors, with support from Senator Investment Group, AiiM Partners, Trousdale Ventures and other undisclosed backers want to see just how far the company can go. 

Part of the money will be used to build out a discovery platform for new materials and new strains in an effort to make Ecovative, the Gingko Bioworks of the mushroom business. While another chunk of change will be used to build out a larger production facility for its mushroom production.

The Gingko analogy may not be that much of a stretch. Using its platform for manufacturing and deep knowledge of fungi, Ecovative has already spun up a food company called Atlast, which raised $7 million to begin building a fake meat empire on the back of a mushroom-made bacon substitute.

A person in a lab coat stands with their back to several trays of Ecovative’s mushroom material growing in trays. Image Credit: Ecovative Design

And the company also has fashion on the brain. A licensing agreement between Ecovative and Bolt Threads helped power that massively funded startup’s push into manufacturing a leather replacement from mushrooms back in 2018.

The deal between the two ended in acrimony and litigation — and now Ecovative is going it alone, looking to be a provider of bulk leather replacements for anything from shoes to belts, to buckskin jackets.

“It seems like there’s a need for somebody who could not be a branded supplier, but to be someone who can provide scalable mushroom leather,” said Bayer. 

Other companies are working on trying to convince consumers to make the switch to mushrooms or other plant-based leather substitutes. Those are businesses like Mycoworks, which raised $45 million from a slew of celebrities last year to build out its own commercial scale mycelial manufacturing business. Or Natural Fiber Welding, which is backed by none other than the omnipresent eco-conscious fashion accessory adorning the feet of almost every venture investor — Allbirds (or are Atoms the new thing? I can’t keep up.)

“The demand for new biomaterials in the fashion industry, such as mycelium, far outstrips the current supply.  Ecovative is tackling this challenge head-on, committing to building a next generation platform capable of producing mycelium at scale,” said Katrin Ley, Managing Director of Fashion For Good, in a statement. 

While Ecovative makes small batches of products under brands like Atlast, Bayer wants his company to be more of a white-label material provider than a branded business making shoes, packaging, and plant-based meat replacements.

The new financing comes on the heels of Ecovative’s partnership with UK packaging licensee Magical Mushroom Company, which recently announced the opening of four more facilities to supply the UK and EU markets with green packaging solutions, the company said. 

“Mycelium is a unique material that outperforms other sustainable alternatives in industries as diverse as fashion and food,” said Evan Lodes, Partner at Senator Investment Group, which first backed Ecovative back in 2019. “Ecovative pioneered the field of mycelium materials, and has invested in the research and development necessary to deliver it at the scale and cost necessary to make a significant impact.” 

Byju’s is eying acquisition of a startup that could help the biggest e-learning Indian firm deepen its footprint in the U.S.

The Indian startup is in talks to acquire online reading platform Epic, a startup that offers unlimited access to over 40,000 books, videos, and quizzes from more than 250 publishers to kids aged 12 or younger, two people familiar with the matter told TechCrunch.

The deal values Epic at “significantly” over $300 million dollars, according to one person, who like the other requested anonymity as the matter is private. The terms of the deal may change and/or the acquisition may not materialize, people warned.

An Epic spokesperson declined to comment Monday evening, and Byju’s did not respond to a request for comment on Tuesday.

Epic, backed by Evolution Media, reaches over 50 million kids in the U.S., a figure that has ballooned from 20 million last year.

The California-based startup, which has raised over $51 million to date, claimed in a press release last year that over 1 million teachers across more than 90% of U.S. elementary schools use Epic.

On Epic, founded by Suren Markosian and Kevin Donahue, children read over a billion books last year. The firm now plans to release several print versions of its original titles at Walmart, Target, and Sam’s Club later this year.

Some original titles released by Epic

Epic collects and analyzes real-time anonymized and aggregated data on how many children read a book, how deeply they engage with it, and where their interests start to fall off.

If the deal goes through, the startup’s offerings would align with Byju’s current playbook in the U.S. In 2019, the Indian startup acquired U.S.-based Osmo, which offers “blended learning” apps to integrate offline activities for kids aged between five to 12.

Byju’s is separately in the middle of concluding a new funding round whose size is expected to balloon over $600 million, TechCrunch reported last week. The new round is expected to value Byju’s at $15 billion.

The new financing round, a major tranche of which has already concluded (about $460 million at $13 billion valuation, per a filing), will be used to finance the new acquisition, the source said.

The Indian giant, which prepares students pursuing undergraduate and graduate-level courses, has witnessed skyrocketing growth amid the pandemic after New Delhi issued a months-long lockdown and closed schools.

India’s second most valuable startup, which serves over 80 million users, has additionally been aggressively exploring ways to grow inorganically.

Byju’s, which acquired coding platform aimed at kids WhiteHat Jr for $300 million last year, is conducting due diligence to acquire decades-old Indian brick-and-mortar institute Aakash and Toppr, another online learning startup in the world’s second largest internet market. These two deals are being financed with the over $1 billion funds Byju’s raised last year, one person familiar with the matter said.

WhiteHat Jr, which sparked controversy last year when it sued two critics, currently generates nearly half of its revenue from the U.S.

MessageBird, the omnichannel cloud communications platform recently valued at $3 billion, is continuing to ramp up its M&A activity. Following last year’s acquisition of Pusher, a company that provides real-time web technologies, it is announcing that it has acquired “video-first” customer engagement platform 24sessions, and customer data platform Hull.

Terms of the two new deals aren’t being disclosed, although MessageBird founder and CEO Robert Vis tells me the three acquisitions add up to about $100 million in total, and we alreadly know that Pusher’s acquisition price was $35 million. I also understand that the 24sessions and Hull acquisitions saw both companies’ investors exit entirely.

Originally seen as a European or “rest of the world” competitor to U.S.-based Twilio — offering a cloud communications platform that supports voice, video and text capabilities all wrapped up in an API — MessageBird has since repositioned itself as an “Omnichannel Platform-as-a-Service” (OPaaS). The idea is to easily enable enterprises and medium and smaller-sized companies to communicate with customers on any channel of their choosing.

Out of the box, this includes support for WhatsApp, Messenger, WeChat, Twitter, Line, Telegram, SMS, email and voice. Customers can start online and then move their support request or query over to a more convenient channel, such as their favourite mobile messaging app, which, of course, can go with them. It’s all part of MessageBird Vis’ big bet that the future of customer interactions is omni-channel.

To that end, the acquisition of 24sessions adds another channel: video. This, Vis tells me, is a particularly important channel where in-person interactions are being replicated digitally. However, he says it’s not just enough to have a video option — you need one that is compliant and secure. This is especially true for regulated industries such as financial services and healthcare. In addition, 24sessions is web-based, meaning that end-users aren’t required to install an app.

“Bringing a safe, secure and customizable video platform into the MessageBird family is the next step in our strategic journey,” said Vis in a statement. “Our portfolio of owned services already includes SMS, voice, email, OTT, social, live chat and push. The addition of 24sessions’ video platform gives us one of the world’s most comprehensive and powerful omnichannel offerings, and is consistent with our having end-to-end control of the stack in order to create magical experiences for our customers”.

“By joining forces with MessageBird, we’re making a leap forward in our mission to improve personal customer contact and turn it into a smooth digital experience, without losing the human touch,” adds Rutger Teunissen, CEO of 24sessions. “Video has become a more embedded, instant, intelligent, and integrated part of the omnichannel customer experience”.

However, communicating with customers more efficiently doesn’t just mean interacting with them on the channels of their choosing and building backend workflows to support this, it also requires a better understanding of the customer and the context of their query. That’s where the acquisition of Hull, based in France and the U.S., comes into play.

Described as a customer data platform (CDP), Hull’s team and technology will be deployed to create an “in-depth analytics layer” between MessageBird’s omnichannel offering and the workflow solutions it provides to customers.

“We want to empower clients to have easy, frictionless conversations with customers, so it’s crucial that we understand where those customers are and how they like to communicate,” said Vis. “To do that, it’s crucial that our platform is able to collect, unify and enrich product, marketing, and sales data and synchronize it across the workflow.”

In total, 45 staff will join from 24sessions, and 14 will join from Hull. The combined M&A brings MessageBird’s total headcount to almost 500 people across its nine hubs globally.

User guides, knowledge articles and community discussions form a detailed, yet very fragmented, landscape of information about a company and its products. Today, a company that’s built a platform both to organize that data, and help those who need it to tap into it more effectively, is announcing a round of funding that underscores the demand it’s seeing in the market for its technology.

Zoomin, an Israeli startup that uses machine learning, natural language processing and some big data magic to help companies build self-service experiences that bring together information and answers pulled from all of the content that’s being generated by customers and the company itself across various channels, has picked up $52 million in a Series C led by General Atlantic, with previous backers Bessemer Venture Partners, Salesforce Ventures and Viola Growth also participating. The company is not disclosing the valuation.

Zoomin will be using the money to continue building out the functionality of its product and to double down on new customer segments.

Originally targeting tech companies and the needs of business end users — early customers included Dell and McAfee, among others — it’s found some interesting growth into other sectors like the food industry, where customers include Burger King, Tim Hortons, and Popeyes, because, as CEO and co-founder Gal Oron describes it, “your typical fast food company has a lot of franchises, and they use a lot of operating manuals. Just like ServiceNow or McAfee.”

It’s also moving into other sectors like finance and healthcare, he added, and expanding to more than just technical support, which in the B2B world is closely connected to sales support, and sales. That could see Zoomin building products that lay out the information in different ways too.

“Technical content is the new marketing,” Oron said. “Companies invest millions in creating marketing material, but they have hundreds of thousands of pages of HTML with all the relevant details, and their customers are interested in technical stuff.”

Zoomin taps into “content” — the source of its answers — in real time wherever it is being made, and those are also typically the places where Zoomin-generated answers are being delivered, too. Documentation sites, customer service portals, support communities, product applications and anywhere that people are searching for help and chatting are also the typical sources of information that get fed into the Zoomin machine.

The financing underscores how much attention investors (and customers) are giving to business support software these days.

The pandemic led to a major shift in how many of us worked and interacted with services — many more people started to work remotely and carried out all of their everyday duties online. In terms of needing assistance when something isn’t going right, all of that has also shifted online, and has put an immense amount of pressure on the infrastructure that had been built to help with that.

Even at the best of times, customer support is in a tough place. It’s where users go when something isn’t working correctly or when they have another complaint, so even out of the starting gate, it can be a fraught interaction. And agents don’t have it much better at the other end, either. On top of the customers and their demands, they’re also typically working under time, cost, revenue and organizational constraints from the company itself, the classic scylla and charybdis scenario. Given all of that, and the particular circumstances of the last year, tools like Zoomin’s have come into the foreground for companies as one way to cope with all of that.

This round comes just three months after the startup came out of stealth with $21 million disclosed in funding since quietly opening for business in 2019. Oron said that the company has served 60.4 million answers to date to its customers (55 million in 2020): that volume grew 300% last year and its customer base doubled in the same period.

The company is banking on some bigger trends in the industry to see that growth continue. It notes that digital support channels — those site pages you visit that include either chatbots or intuitive search, dialogue boxes across the site, apps, and other places that don’t have live agents helping you — have grown in ubiquity, with some 60% of businesses projected to build self-service portals in the next 12 to 18 months. The proof is in the pudding, so to speak: Zoomin says that the product content that it helps surface can account for up to 70% of a company’s overall web traffic.

That brings up an interesting parallel between what Zoomin does and one of the major traffic controllers of modern times: the search engine. Google dominates how many of us use and discover things on the internet, and it’s been getting increasingly specific with the help that it provides to people, giving “answers” directly on search result pages — whether they are answers to questions, shopping suggestions, news, locations, videos, or any other number of end points.

Oron is quick to say that he has no interest in ever expanding what Zoomin does to make it a consumer-facing tool like Google’s, but it does highlight what a big and tricky problem information organization — or “knowledge orchestration”, as Zoomin refers to it — can be in our disjointed digital world, and the power of a company that can help bring order to that.

While Zoomin may not be interested in climbing the mountain that is competing with Google on its terms, it would be interesting to see how Google evolves its own work in site search, and whether that becomes a competitor on Zoomin’s terms. Zoomin’s terms are to get people to search on company sites themselves, not Google, for answers.

“The first place — a company’s site — is the right location,” Oron said.

Meanwhile, all of the “what ifs” show is that there is indeed a lot of potential here, one reason you’re seeing companies like Salesforce investing alongside the big financial backers.

“We are excited to be supporting Zoomin in this important step of their growth story through an investment that marks our third-ever partnership in the burgeoning Israeli tech market. At General Atlantic, we pride ourselves on identifying category builders and growth-oriented disruptors, and view Zoomin as a natural fit given those priorities,” said Alex Crisses, MD, Global Head of New Investment Sourcing and Co-Head of Emerging Growth at General Atlantic, in a statement.

“Having helped build the increasingly important field of knowledge orchestration from the ground up, Zoomin is providing much-needed value to large enterprises,” added Gary Reiner, a current General Atlantic Operating Partner and previous GE Chief Information Officer. “We look forward to partnering with and supporting Zoomin as they continue to innovate the way that customers experience crucial enterprise product content.”

After weeks of rumors, Xiaomi officially confirmed that it is making a foray into the electric vehicle space. The Chinese smartphone and IoT giant will set up a wholly-owned subsidiary to operate a smart EV business, the company said in a filing on Tuesday.

Xiaomi will inject an initial 10 billion yuan ($1.52 billion) into the venture with the total investment amount to reach $10 billion over the next ten years. Xiaomi founder and CEO Lei Jun will serve as the CEO of the new EV venture.

It’s unclear from the filing whether Xiaomi will sell cars under its own household brand and contract manufacturers to take care of production, as it has done for most of its hardware devices. The company has long billed itself as an “internet firm” with a light-asset business model. The goal is to generate a chunk of its profits by selling services powering a myriad of price-friendly hardware products it sells.

A representative from Xiaomi said the company has no further detail to share beyond the filing.

Xiaomi is the latest Chinese tech company to enter the red-hot EV industry. Chinese search engine giant Baidu recently announced it would be making EVs with the help of automaker Geely.

More to come…

In the world’s largest gaming market, China, console games play a relatively small part as their revenue has been meager compared to mobile and PC games for years — at least by the official numbers (more on this later). There remains a community of hardcore console lovers, but they are finding it harder to get hold of devices and cartridges recently.

A handful of grey market videogame console vendors on Taobao stopped selling and shipping this week, according to checks by TechCrunch and online posts by gamers. Before we examine what might be happening here, a bit of industry history is needed.

In 2000, China banned the sale and import of videogame consoles as concerns over addiction in teenagers grew. Even with the ban, imported consoles still existed in the grey market targeting a group of loyal players. Meanwhile, the online PC and mobile gaming industry flourished, in part thanks to their affordability and the social experience built into their mechanics.

When China finally lifted its restriction on consoles in 2015, giants like Sony and Microsoft quickly responded by releasing Chinese editions of their products through local partners. Nintendo Switch hit the Chinese shelves in 2019 via a much-anticipated partnership with Tencent, which itself is the world’s largest gaming firm. But the grey market largely persisted because mainland Chinese versions of the consoles are subject to strict regulatory oversight, which limits users’ choice to a small friendly range approved by censors.

Many Chinese players thus resort to brick-and-mortar electronics bazaars and online marketplaces to find imported editions of PlayStation, Xbox, and Nintendo Switch, along with their games. These products normally enter China through parallel trading, the import of legitimate goods through unauthorized channels. The games that are brought in normally lack a Chinese gaming license, which is hard to obtain even by local publishers.

Several major videogame console importers on Taobao have suspended business. Screenshot: TechCrunch

It’s unclear how many imported consoles and console games were taken down from Taobao and what triggered the purge. Tgbus, one of the largest console game sellers on Taobao with 462,000 followers, currently has zero product listing. When asked by TechCrunch, a customer service staff said the store has temporarily halted shipping due to “a water leak in the warehouse.” When we pressed further, the person said it was due to “an electrical-equipment failure.”

Other vendors keep their responses vague, citing “special reasons” for the suspended services. One seller named the “Shanghai Gaming Console Store” said it suspended its business at the request of Taobao, without elaborating further.

Alibaba could not be immediately reached for comment.

The incident appears to inflict mostly console sellers with a sizable business at this moment. Imported cartridges and console devices can still be found on smaller Taobao stores and alternative platforms like Pinduoduo by searching the right keyword.

Some users see the move as China further tightening its grip on what gamers get to play. Over the past year, Apple’s China App Store removed thousands of games to wipe out games without China’s official greenlight. Other motives are politcal. Animal Crossing was pulled from grey market stores on Taobao and Pinduoduo after one of Hong Kong’s most well-known pro-democracy activists used the game as his protest ground.

Other users point out that customs officers regularly clamp down on parallel trading, which is designed to evade import tax because goods are carried by traders who appear as regular travelers. This isn’t the first time the console grey market has been hit, either. Some grey goods manage to fly under the radar before they attract critical sales. There are signs that the new Monster Hunter Rise, a Nintendo-Switch exclusive which isn’t available on the Chinese console edition, is stoking much interest among local players in recent weeks and may have driven some imports.

In the world’s largest gaming market, China, console games play a relatively small part as their revenue has been meager compared to mobile and PC games for years — at least by the official numbers (more on this later). There remains a community of hardcore console lovers, but they are finding it harder to get hold of devices and cartridges recently.

A handful of grey market videogame console vendors on Taobao stopped selling and shipping this week, according to checks by TechCrunch and online posts by gamers. Before we examine what might be happening here, a bit of industry history is needed.

In 2000, China banned the sale and import of videogame consoles as concerns over addiction in teenagers grew. Even with the ban, imported consoles still existed in the grey market targeting a group of loyal players. Meanwhile, the online PC and mobile gaming industry flourished, in part thanks to their affordability and the social experience built into their mechanics.

When China finally lifted its restriction on consoles in 2015, giants like Sony and Microsoft quickly responded by releasing Chinese editions of their products through local partners. Nintendo Switch hit the Chinese shelves in 2019 via a much-anticipated partnership with Tencent, which itself is the world’s largest gaming firm. But the grey market largely persisted because mainland Chinese versions of the consoles are subject to strict regulatory oversight, which limits users’ choice to a small friendly range approved by censors.

Many Chinese players thus resort to brick-and-mortar electronics bazaars and online marketplaces to find imported editions of PlayStation, Xbox, and Nintendo Switch, along with their games. These products normally enter China through parallel trading, the import of legitimate goods through unauthorized channels. The games that are brought in normally lack a Chinese gaming license, which is hard to obtain even by local publishers.

Several major videogame console importers on Taobao have suspended business. Screenshot: TechCrunch

It’s unclear how many imported consoles and console games were taken down from Taobao and what triggered the purge. Tgbus, one of the largest console game sellers on Taobao with 462,000 followers, currently has zero product listing. When asked by TechCrunch, a customer service staff said the store has temporarily halted shipping due to “a water leak in the warehouse.” When we pressed further, the person said it was due to “an electrical-equipment failure.”

Other vendors keep their responses vague, citing “special reasons” for the suspended services. One seller named the “Shanghai Gaming Console Store” said it suspended its business at the request of Taobao, without elaborating further.

Alibaba could not be immediately reached for comment.

The incident appears to inflict mostly console sellers with a sizable business at this moment. Imported cartridges and console devices can still be found on smaller Taobao stores and alternative platforms like Pinduoduo by searching the right keyword.

Some users see the move as China further tightening its grip on what gamers get to play. Over the past year, Apple’s China App Store removed thousands of games to wipe out games without China’s official greenlight. Other motives are politcal. Animal Crossing was pulled from grey market stores on Taobao and Pinduoduo after one of Hong Kong’s most well-known pro-democracy activists used the game as his protest ground.

Other users point out that customs officers regularly clamp down on parallel trading, which is designed to evade import tax because goods are carried by traders who appear as regular travelers. This isn’t the first time the console grey market has been hit, either. Some grey goods manage to fly under the radar before they attract critical sales. There are signs that the new Monster Hunter Rise, a Nintendo-Switch exclusive which isn’t available on the Chinese console edition, is stoking much interest among local players in recent weeks and may have driven some imports.

After partnering with Patreon last year to support patron-only podcasts, Acast has developed a full suite of subscription tools called Acast+.

The company has experimented with paywalled podcasts beyond Patreon in the past, but Acast+ appears to be its most comprehensive offering yet. Podcasters who run ads from Acast will be able to introduce a variety of other paid options, such as ad-free streams, exclusive episodes and early access to content.

Listeners will be able to access this content from the podcast players of their choice, including Apple Podcasts and Google Podcasts.

In exchange, Acast will take a cut of subscription revenue — Vice President of Product Matt MacDonald described this as “part of the overall package of using Acast,” with podcasters benefiting from having the full monetization experience managed within Acast. That means they can upload and manage access to all their content from a single system (rather than having separate paid and free feeds) while also getting the “full revenue picture” of both their advertising income and subscription income.

MacDonald said it’s also crucial that Acast is supporting subscription access across podcast players, rather than creating a listening app or destination of its own.

“”That’s a really clear distinction,” he said. “We want to make sure the podcaster’s listeners are their listeners. We’re just giving them a financial tool to help them build a relationship with the listeners that are supporting their show.”

Acast co-founder Johan Billgren also noted that podcasters can customize the experience down to the names of the subscription tiers and even what subscribers are called. He also said that after the launch of Acast+, the company will continue working with Patreon.

“We want to give the most options to the creator,” Billgren said. “They are in charge of their relationship, and if Patreon is the best option for them, we want to give them that option.”

Image Credits: Acast

More broadly, he suggested that Acast+ reflects “a big shift” as podcasts go from from being “completely free and ad-funded” to a pursuing a broader range of business models.

“I think that the financial relationship is an expression of the overall relationship,” MacDonald added. (Listener relationship-building was also a theme in Acast’s acquisition of RadioPublic last month.) But certainly the financial side is important: “There are a number of times that I’ve heard podcasters say, ‘If I could make just a little bit more money, I could squeak out another episode.’ We’re giving them the financial pathways to do that.”

Acast+ is currently in beta testing and accepting signups from interested podcasters.