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Alphabet Roundup: Regulatory, I/O Conference, Music Subscription

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Alphabet GOOGL executives covered almost all product categories and privacy initiatives at its annual I/O event. These updates, regulatory developments and music subscription growth numbers made headlines last week. Here are a few details-

Regulatory

First up is the new copyright directive from the EU that makes video sharing platforms like YouTube liable for hosting copyrighted material without a license. YouTube already has broad licenses with a large number of rights holders but it may need to further broaden those licenses and introduce additional filters so copyrighted material can’t be overused by creators. There’s a lot of criticism of the new policy that member states of the EU have two years to frame laws on.

Creators have trepidations about YouTube filters but think/hope the vaguely worded policy may not actually go into effect in its current form. Since the EU is looking for harmonized implementation and some countries (Italy, Sweden, Finland, Poland, The Netherlands and Luxembourg) are against the directive, this will be difficult but maybe not impossible to achieve.


Experts believe that it puts that much more power in the hands of tech giants because they are the ones with the funds to ensure their compliance. So the attempt to make the tech giants pay more to creators may actually backfire by pushing out smaller players.

After studying the Android antitrust issue since last year, the Competition Commission of India (CCI) started a formal inquiry into the matter in April. Details are scarce since the probe order isn’t public but people familiar with the matter have said that the case will gain strength from the antitrust findings in Europe (where the company was fined $5 billion). Alphabet has promised to defend itself and work with the Indian authority to prove how Android has promoted competition and not stifled it.

In an attempt to curb the proliferation of fake news, the Singapore parliament has passed the Protection from Online Falsehoods and Manipulation Act. The new law will require online media platforms to correct or take down content after being notified by the government, failing which persons responsible can be imprisoned for up to 10 years or fined up to S$1 million ($735). As may be expected, tech companies like Facebook FB, Alphabet and Twitter TWTR are objecting. Journalists and activists, that have as often as not been involved in mischief-making, are also objecting.

I/O

Privacy

Google said it was doing much in terms of privacy, primarily as it relates to Chrome. So users will now be equipped with information on how cookies are tracking them across the web and choose the ones they want to clear. They might for instance was to clear the ones that track them while retaining those that help them stay logged on to sites or personalize website settings.

It also intends to prevent browser fingerprinting (a method of tracking through the browser in relatively unobtrusive ways).

Industry players and marketers are playing it by ear mainly because most of these changes are still a work in progress and also because the final thing might not be something to cheer at after all. Some think Google might give its own tracking preference while blocking the rest (though Google has promised it won’t do this), others are relieved this will take time to implement as they work to reduce dependence on cookies.

Google also mentioned other measures that will improve privacy. For example, some AI capabilities like facial recognition and voice search are increasingly taking place on devices rather than in the cloud. It is also introducing controls that allow people to manage which apps can access location data.

Hardware

Google launched two cheaper Pixel models.

The Android 9.0 based Pixel 3a, made from polycarbonate, has a 2210×1080 resolution 5.6-inch screen, weighs 147 gms, 64GB internal storage (no 128 GB version and no option for external storage), single 8MP front camera and 12.2MP rear camera, a Qualcomm Snapdragon, 670 processor, 4GB RAM, Bluetooth 5.0 at $399.

The larger Android 9.0 based Pixel 3a XL, has a 2,140×1,080 resolution 6.0-inch OLED display and otherwise similar specs. It costs $479.

Reviews indicate that the company was able to cut the cost of the original Pixel 3 with this launch, while sacrificing the materials used but keeping the look sleek and attractive and not impacting experience much. Missing are wireless charging, water resistance, Gorilla Glass and a wide-angle selfie camera. They fall in the same category as OnePlus, Motorola and Xiaomi in the midrange market.

The company is doing away replacing “works with Nest” with “works with Assistant” for a select few apps so Assistant can play a bigger role in the connected home.

Assistant

Expanded App Actions now offer shortcuts for health, finance, food and ridesharing; upgrades aimed at the smart home helping gadgets respond sooner and more reliably will be available in June with early partners being Philips, LIFX, TP-Link and Wemo; ability to build games for smart displays like the Google Home Hub is here.

Qualcomm QCOM showcased an Assistant-based Bluetooth earbud reference design that should soon see a flood of the dvices from a large number of hardware makers. The two buds are connected to each other with a neckband to cut down on the additional cost of a Bluetooth chip, battery and other components. In order to save battery life, Assistant isn’t always on, but has to be activated by the push of a button.

Apple’s AAPL Siri-powered AirPod is more expensive but the buds are independent and Siri is always on. Qualcomm has a similar deal with Amazon AMZN for its Alexa-powered AirPods.

Google also added a “personal references” capability that gives you more reason to share personal information regarding your relationships with people, so you can use more natural language commands for Assistant. As an example the executive showcasing the ability asked Assistant about the weather at his moms place and how to get there and the time it would take. Assistant was able to answer all the questions by referencing Maps. Of course, users can edit or delete all the shared info through a “You” tab within the Assistant settings menu.

Auto

There are a couple of stories here, the first one being a revamp of Android Auto, announced at I/O. It makes the user interface easier, reflecting the same setup as on Android phones, so users don’t have to learn another system. As soon as you connect your phone to the car, it opens maps, while continuing to play your media, then allows easy access to apps with a single button, a shortcut widget to help you switch between apps and a notification bell that opens up notifications you see for yourself or have Assistant to read out to you.

There’s also a status bar at the top showing the time, battery and connection status, just as in your phone. The whole experience overall is smoother.

CEO John Krafcik of Alphabet’s autonomous car unit Waymo announced that its paid service in the Phoenix area has now crossed a 1,000. He also announced an agreement with Lyft to allow some users to hail Waymos through the Lyft app. This is a very small test phase that currently includes safety drivers. Presumably, it will have learnt enough to run without the drivers by the time it has more cars ready to take to the roads.

Healthcare

Among the AI developments announced at the I/O conference, Google said that its AI can now detect subtle lesions from computed tomography (CT) scans a year before human doctors, thereby increasing survival rate of lung cancer patients by up to 40%.

Separately, Alphabet’s venture capital unit GV led a $58.5 million series A funding round to launch a biotech startup called Verve. The startup will be researching gene editing therapies initially focused on treating coronary artery disease in adults. The therapy is years from release and the funds will be used for early testing in animals. There is currently no approval for gene editing therapies because of their possibly permanent harmful side effects, so this is likely a particularly long project.

Music Subscription

The Recording Industry Association of America’s (RIAA) 2018 annual report says that the market had a good year, growing 11.9% to $9.8 billion. It shows an increase of around 5X in paid music subscriptions from 10.8 million in 2015 to 50.2 million in 2018 (42.2% last year alone). Streaming has obviously been very positive for the industry, constituting 75% of all music consumption formats.

Google’s YouTube has been around for a long time, but it earlier preferred an ad supported business. The current demand for ad-free music and the need to diversify beyond its ad-based business led the company to launch a paid service. That service, earlier called Google Play Music, is now being morphed into YouTube Music and according to the RIAA, pulling in 15-16 million subscribers. It obviously still has a long way to go: Spotify SPOT has 100 million and Apple 50 million.

Google refuted the number and the fact that it’s been seeing slower growth than the others, saying that combined YouTube Premium and YouTube Music are up 60% from last year.

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