Trusting the web

With misinformation rife on the web, services like Google and Facebook will have to do more to make their services more reliable.

Following last week’s US election attention has fallen onto the role of Facebook in influencing public opinion and the role of rumours and fake news.

The CEO of Facebook, Mark Zuckerberg, says claims that his company’s news feed influenced the US election are nonsense but, as Zeynep Tufekci the New York Times writes, the platform has shown in its own experiments that the service does influence voters.

Sadly misinformation is now the norm on the web given anyone can start a blog and post ridiculous and outlandish claims. If that misinformation fits a group’s beliefs, then it may be shared millions of times as people share it across social media services, particularly Facebook.

Facebook’s filter bubbles exacerbates that problem as each person’s news feed is determined by what the company’s algorithm thinks the user will ‘like’ rather than something that will inform or enlighten them.

Those ‘filter bubbles’ tend to reinforce our existing biases or prejudices and when fake news sites are injected into our feeds Facebook becomes a powerful way of confirming our beliefs, something made worse by friends gleefully posting fake quotes or false news that happens to fit their world views. If you click ‘Like’, you’ll then get more of them.

Over time, Facebook risks becoming irrelevant if the news being fed from the site becomes perceived as being unreliable

For Facebook, and for other algorithm driven services like Google, the risks in fake news don’t just lie in a loss of credibility, there’s also the risk of regulatory problems when news manipulation starts affecting markets, commercial interests or threatens established power bases.

The fake news problem is something that affects the entire web and its users, for Facebook and Google it is becoming a serious issue.

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Google’s grab for the smartphone market

Google’s Pixel smartphone is part of the company’s bid to exert greater control over the smartphone market.

This week Google released its latest smartphone, the Pixel, to mixed reviews. Controlling the most popular mobile operating system, Android, isn’t enough for the company.

As Microsoft found, just supplying the operating systems for smartphones isn’t enough to influence the market. Apple, along with Nokia and Blackberry before them, showed that the path to both controlling the segment and being profitable relies on having devices designed for their software.

Given the Pixel’s price point, it’s unclear how well it will do against the iPhone, Samsung’s models or the plethora of Chinese devices but for all the Android ecosystem’s players, having its controlling owner running in opposition to them can’t be comforting.

Again though Microsoft’s experience is instructive, and encouraging, for the broader Android community as Microsoft’s attempts to push out Windows CE devices failed dismally. For Google to be successful where Microsoft failed would require a degree of corporate discipline the search engine giant is not renown for.

In the Windows ecosystem, Microsoft strength was licensing and controlling access to the operating system. Android’s strength in the smartphone world is that Google doesn’t have the same veto power. To be able to exercise control over the market, Google needs a big device share.

Ultimately though the success of the Google Pixel smartphone will depend on how many users will adopt it. It may be time for another round of smartphone subsidy wars.

 

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Google scraps Project Ara

As predicted it seems Google’s Project Ara is about to be another victim of the company’s attention deficit disorder.

Project Ara, Google’s experimental modular phone, seems to be doomed reports Reuters.

Sadly this isn’t surprising as the indications of Ara’s demise have been around for a year.

In some ways this isn’t surprising as Google retreated from the smartphone market at the beginning of 2014 with its sale of the Motorola handset business, the company’s notorious attention deficit disorder wouldn’t have helped the project’s survival chances either.

Should Reuter’s report be true, then Google’s management will have shown again that the company isn’t prepared to stick with long term research projects and that journalists, not to mention researchers and developers, need to treat the company’s programs with some scepticism.

For the Ara team, they’ve no doubt learned a lot in developing this project and it will be interesting to see how that knowledge is applied to other products, few of which will belong to Google.

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Everyone’s a winner with Pokemon Go

Pokemon Go marks the start of the augmented reality gold rush, who profits from it remains to be seen.

It’s remarkable how the reworking of a 1990s video game is proving to be the first big augmented reality success.

As I’m writing this in the Sydney Airport departures lounge, thousands of people are getting ready to trawl the city’s streets for Pokemon as the company’s servers struggle with the load.

For Nintendo, a company that’s struggled to remain relevant in recent years, Pokemon Go’s success revitalises them while for Niantic, the augmented reality and mapping service spun off from Google, this validates their business.

Niantic’s success after being spun off from Google probably indicates the future for many of Alphabet’s many companies. Freed from the constraints of Google’s sprawling bureaucracy, companies like Niantic are far more likely to be able to execute on their technologies.

We can expect to see plenty of companies looking at replicating Pokemon Go’s success with their products and many millions of bits will created as the marketing industry ponders how it can make money from augmented reality games and applications. Most will fail.

The big winner though from Pokemon Go’s success are those in the artificial and virtual reality communities, the great success of the product will have caught the imagination of many executives and entrepreneurs – particularly in the tech sector where the search for the next big is becoming a little frantic as investors and consumers become jaded with smartphones and social media.

Pokemon Go marks the start of the augmented reality gold rush, who profits from it remains to be seen. It also gives Alphabet a strong indicator of how to monetize the companies under the Google umbrella.

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Lenovo and the hunt for profitable smartphone markets

Lenovo’s smartphone announcements are part of an industry desperately trying to find new profit centres and markets.

With Google’s Project Ara seemingly stalled, it was interesting to see Lenovo announce the Moto Z modular phone this week.

The question remains though whether this concept is a solution looking for a problem however if Lenovo open the device up to third party accessory makers, we could see a surge of innovation similar to the ‘plug compatible’ IBM days which may drive consumer interest.

Lenovo is still struggling to find its feet in the mobile phone market, so finding a compelling product to drive sales and improve margins in a largely unprofitable industry is a priority.

It may be the other smartphone announced by Lenovo in San Francisco, the clumsily named Phab 2 Pro, could be where the manufacturer finds its niche with Google’s Project Tango 3D sensing technologies.

The Phab 2 Pro’s 3D capability may be the beginning of accessible virtual and augmented reality systems however hands on reviews of the device indicate it may be some way from being ready for public release.

Lenovo’s announcements show how the smartphone markets is currently in a state of transition as vendors try to find the next new profit and growth centres. To complicate matters, all the Android manufacturers are waiting to see what Apple’s next move will be.

 

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Google bets on artificial intelligence

Google bets on artificial intelligence and machine learning as the company deals with the shift to mobile

Breaking with the company’s tradition of the Sergi, Google’s CEO Sundar Pichai writes this year’s founders letter laying out how the search engine giant is focusing of artificial intelligence and the machine learning.

Pichai’s view of the world seems to tie in very closely with founders Larry Page and Sergei Brin with him laying out a vision of making the internet and computers accessible to all.

The challenge for Google is the shift away from personal computers, something that the company is struggling with and a factor that Pichai acknowledges.

Today’s proliferation of “screens” goes well beyond phones, desktops, and tablets. Already, there are exciting developments as screens extend to your car, like Android Auto, or your wrist, like Android Wear. Virtual reality is also showing incredible promise—Google Cardboard has introduced more than 5 million people to the incredible, immersive and educational possibilities of VR.

Whether Google can execute on that vision and manages to diversify its revenues away from depending almost exclusively upon web advertising will be what defines Pichai’s time as the company’s CEO. He has a challenging task ahead.

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Cloud computing’s elusive gold

Microsoft and Alphabet’s Google show the fragility of even the most profitable online business models

Alphabet, aka Google, and Microsoft yesterday announced their quarterly results and despite both making healthy profits the numbers show the online world is a tough place to make money.

Microsoft’s stockholders took a five percent hit to their wallets after the company announced weaker than expected results for the last quarter.

Notable in the results were the stunning sales growth of its cloud services with Azure boasting a 120% year on year on year increase.

Yet Microsoft’s Intelligent Cloud division which includes Azure saw its profits fall nearly 13%, showing the company’s products may be making inroads against Amazon Web Services but making profits in that market is very tough indeed.

Similarly Alphabet’s results still show the company is sill totally dependent upon the advertising river of gold for its profits.

Particularly concerning for Alphabet is its ‘other bets’ division doubled its sales but saw losses increase by 20%. Overall Google’s advertising revenues made up 89% of Alphabet’s total revenues this quarter compared to 90% last year.

While both companies have very healthy profits – about five billion dollars this quarter for each – Alphabet’s continued dependence on Google advertising and Microsoft’s declining profitability should be a worrying sign for shareholders in both companies.

Both companies show that despite the apparent riches of the technology sector, making profits is getting tougher. Shareholders of both companies should be watching carefully for any disruption to either business.

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