13th June 2019
Meeker Internet Report: Too Much Streaming, Not Enough Security
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By PC Mag
Pc Mag - It's that time of year again: venture capitalist Mary Meeker this week returned to Code Conference with another edition of her annual Internet Trends Report.
Meeker's title is different (she left her longtime post at Kleiner Perkins Caufield & Byers to found a new firm called Bond Capital), but the rapid-fire 300+ slide presentation is the same. We read the whole thing so you don't have to.
The prolonged public reckoning over how Facebook and other social media platforms handle data has, at long last, made privacy a core feature requirement for consumers. Facebook is pivoting toward privacy, Apple continues to thumb its nose at competitors by touting the privacy features of its hardware and software products, and the rollout of GDPR has necessitated greater privacy controls on a global scale. Meeker projects that Facebook's revenue growth will continue to decelerate amid these concerns, and that more consumers care about privacy than a year ago amid greater consumer privacy pushes from regulators everywhere from the California to the EU.
The explosion in online subscription services, from music and video streaming to cloud-based software and e-commerce, has dramatically weakened the consumer value proposition of subscribing to just one or a handful of services that can meet your needs. Meeker said the reality is that customer acquisition cost (CAC) can't exceed lifetime value (LTV) for very long.
Looking at the glut of available and impending content streaming apps, the 2019 Internet Trends Report states that the availability of a free trial or tier is the most important factor in trying a new service. Even as players spend billions bankrolling movies and shows for their services, content libraries and exclusives aren't as important to users as value and affordability.
Facebook and Google's share of the digital advertising market continues to grow, other tech and social media corporations are gaining steam, and everyone else is left with an increasingly smaller slice of what's left. Meeker found that Google's ad revenue raised 1.4x in 2018, Facebook's ballooned by 1.9x, and the combination of Amazon, Twitter, Snap, and Pinterest's ad revenue grew 2.6x. Advertising is how a lot of Big Tech makes its money, and this complete disruption of the ad market has wrought collateral damage across industries, most notably in digital media.
Images and videos are becoming many online users' primary form of communication. Meeker said this is owed to a combination of factors including better smartphone cameras and batteries, faster cellular data and Wi-Fi, and the popularity of image-sharing apps headlined by Instagram. The annual number of new photos taken globally has eclipsed a trillion, and image sharing has skyrocketed as IG's monthly active user base has swelled. The trend has been buoyed not just by Instagram, but on a much heavier focus on images, video, and ephemeral messaging such as Stories across Facebook, Twitter, Snapchat, Pinterest, and beyond.
One of Meeker's slides quotes Looker CEO Frank Bien, who said "data is the new application." Business Intelligence (BI) company Looker was recently acquired by Google Cloud, less than a week before Salesforce dropped $15.7 billion on BI leader Tableau. Meeker said that businesses, consumers, and even regulators are all "drinking from the data fire hose" as more data is collected, stored in the cloud, optimized, and analyzed by AI to streamline processes, target products, and improve customer satisfaction. No matter where you look, data is king.
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