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Lab Weekly — 11/01/2019

Re-examine the streaming war; plus news and stats roundup

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Lab Originals

The OTT Premiere Season Is Upon Us

Apple and Disney officially enter the streaming arena, with AT&T and Comcast in the wings, and bundling is back in vogue. Let’s re-examine the OTT streaming landscape on the eve of the #AppleTVPlus launch, based on everything we know so far.

In case you missed it…

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The Unfulfilled Potential of the Sharing Economy

The challenges that WeWork and Uber are facing, and what they mean for the future of the sharing economy

News Analysis

Apple’s $249 Airpods Pro Pack Noise Cancellation And Transparency Mode [Engadget]

Surprisingly, Apple dropped the much-anticipated premium in-ear update to AirPods via a press release on Monday. The notable new features, active noise canceling and a Transparency Mode (which allows users to hear the environment despite wearing earplug-like earbuds), bring a clear functional upgrade to the AirPods, justifying its spiked $250 price. The addition of transparency mode indicates that Apple is cognizant that some people are keeping their AirPods on all the time. All the early reviews have been quite positive, and there is little doubt that Apple will move a big amount of units during the upcoming holiday season. According to the estimation of Apple analyst Neil Cybart, Apple is projected to sell 55M pairs of AirPods in FY2020. With some of that demand likely shifting to AirPods Pro, AirPods Pro unit sales may hit as high as 20M in FY2020.

From a long-term strategy perspective, Apple once again extends its formidable lead in the wearable market by building out its AirPods lineup and upselling the existing users. To read more about the latest developments in the hearable space, check out the first section of our recap of the latest Google hardware event.

Related: Apple is working on new smart home products with a new team [Bloomberg]; More signs point to Apple’s AR headset arriving in 2020 [Engadget]

Google’s Parent Company Alphabet Offered To Buy Fitbit [CNBC]

It is clear why Alphabet would be interested in buying Fitbit, given that Android Wear has lagged behind Apple Watch or Fitbit in terms of sales numbers and adoption rate. This not only undermines Google’s long-term positioning in a post-mobile future, it also means activity and biometric data is one area Google has a data deficit. Buying Fitbit could theoretically help Google solve both problems. Google could use those data for ad targeting, but given the sensitivity of the kind of data wearables generate, Google is more likely to use them for internal learnings as they continue to evolve Android Wear and their broader wearable strategy. In addition, it is interesting to note that Alphabet also has two subsidiaries, Calico and Verily Life Sciences, in the health research arena, which could also benefit from the biometric data and expertise in designing fitness experiences that Fitbit brings to the table.

Related: French drugmaker Sanofi, Google to use data tech for innovations [Reuters]; Google Fit now available on iOS with Apple Health sync [9to5Google]; Alphabet invests in digital health insurance provider Oscar [Wired]

Uber Announces Deeper Push Into Financial Services With Uber Money [CNBC]

Continuing its recent efforts in diversifying its core business to defend itself from the AB5 bill, Uber announced a new division called Uber Money, which includes a digital wallet and upgraded debit and credit cards. Interestingly, this is not being rolled out as a consumer product. Instead, Uber will be focusing on offering its four million-plus drivers and couriers around the world access to a mobile bank account to ensure they can get paid after each ride. Nevertheless,

Uber could one day extend its banking service to regular users as well. This move calls to mind what Grab has accomplished in transforming the mobile finance space in some Southeast Asian markets, but Uber is unlikely to replicate Grab’s success due to the vastly different market environments. If they play their cards right, they could leverage their direct customer relationship to convert some late adopters of mobile payments and to integrate with its loyalty program.

Related: Uber Eats unveils delivery drone, plans test flights by end of year [TechCrunch]; Lyft simplifies its subscription service with the $20-a-month “Lyft Pink” with fewer perks [The Verge]

NBCUniversal Rolls Out Its Shoppable TV Ads [TechCrunch]

While this is a commendable effort for NBC to add some interactivity and accountability to its live TV ads. Matching most direct-response ads on digital channels, the new Shoppable Ads will provide brand advertisers a new way to drive sales.and site visits. However, this new ad unit does not come with the best user experience, as it requires viewers to scan the QR codes in a pop-up banner shown during ads and get redirected to the corresponding mobile site to make the purchase. There is simply too much friction left in the process, even if the QR code solution does improve product discoverability and shorten the path towards purchase. Understandably, the peacock network went this route to ensure it works across platforms and devices, but a subpar user experience dependent on QR codes will likely do little in changing the consumer behavior of live TV viewers and pushing the late adopters towards mobile shopping.

Related: Nielsen adds Amazon Prime Video to SVOD measurement with limitations [Variety]; Roku partners with Adobe, opens up first-party data to programmatic buying [Multichannel News]

Stats To Know:

  • Spotify’s podcast strategy is starting to pay off. The music streaming company reported in its latest quarterly earnings call that 14% of its MAUs listen to podcasts, podcast hours streamed grew 39% QoQ, and podcast engagement is driving increases in free to paid conversion.
  • Facebook keeps growing its global user base despite ongoing scandals and backlash. The company reached 2.45 billion monthly users, up 1.65%, from 2.41 billion in Q2 2019 when it grew 1.6%, and it now has 1.62 billion daily active users, up 2% from last quarter, according to the company’s latest quarterly report. Notably, Facebook gained 2 million users in each of its core U.S. & Canada and Europe markets that drive its business, after quarters of stagnant growth in those regions.
  • Apple Pay transaction volume is growing 4 times as fast as PayPal, CEO Tim Cook shared during Apple’s Q4 2019 earnings call. In total, Cook says that there were 3 billion Apple Pay transactions during Q4 2019, and Apple Pay transactions and revenue both doubled year-over-year.

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