Jun 4, 2021

Axios Login

You've been listening to John Cage's 4' 33''. We now return you to your regularly scheduled newsletter.

Today's newsletter is 1,380 words, a 5-minute read.

1 big thing: Small businesses' big online migration

Illustration: Aïda Amer/Axios

When the pandemic forced cities to shut down, millions of businesses moved their operations online — a shift that is having lasting impacts on hiring, real estate and the way we buy goods and services, Axios' Kim Hart and Sara Fischer report.

Why it matters: Small businesses are the engines of the economy. While many did not survive the last 15 months, new businesses have popped up and found ways to find customers in the new, all-online-all-the-time environment.

By the numbers: Tech giants say they saw massive growth in online adoption by small businesses during the pandemic.

  • Stripe CEO Patrick Collison tweeted Thursday that "more businesses launched on Stripe since the start of 2020 than did in the rest of Stripe's history before then." For reference, Stripe launched in 2009.
  • Facebook CEO Mark Zuckerberg said in April that the company now has more than 200 million businesses that use its free services — more than double since 2019 — and that more than 1 million businesses have set up shops on its platform.
  • Etsy: The number of active sellers on Etsy soared from 2.7 million in 2019 to 4.4 million in 2020, the company said in May.
  • GoDaddy: The world's largest internet domain registrar, GoDaddy said last year it added 1.4 million net customers — nearly double the amount it added in 2019.

Be smart: While most people think of the pandemic's digital revolution in terms of e-commerce, the services sector has perhaps experienced the most fundamental changes during COVID.

  • New products and tools from tech platforms have made it much easier for people to obtain services online, like doctor's visits or fitness classes.

The big picture: The digital small business boom has been a great opportunity for tech giants to prove their value to society while facing record regulatory scrutiny.

  • Google, Facebook and others have spent millions on advertising touting ways they've helped small businesses survive during the pandemic — and helping the overall economy to recover.

Between the lines: The digitization of small businesses wasn't all positive. As companies moved their presence online, many closed their brick-and-mortar shops, leaving empty storefronts in shopping centers and main streets.

  • The workforce needed for all-digital companies is different than what's needed for an office or in-person retail store.
  • A recent Facebook survey of more than 30,000 small businesses showed that nearly a third of small- and medium-sized businesses have had to lay off workers as a result of COVID-19. Half say they don't plan to rehire employees in the next six months.

The bottom line: "Overall rate of migration to the internet economy is hard to overstate," Collison noted.

2 . This year's Apple developer event is different

Image: Apple

One question heading into Apple's Worldwide Developer Conference next week is whether the iPhone maker will combine the usual software announcements with an olive branch to software makers who are criticizing the company's business practices.

The big picture: Outspoken critics like Spotify, Epic and Match Group are still in the minority, but the complaints they are voicing reflect broader concerns over everything from the size of Apple's commissions to its favorable treatment of its own products and services.

Driving the news: Apple's Worldwide Developer Conference kicks off with a keynote on Monday, where the company is expected to announce the news of the week, including the first details of the next versions of iOS and MacOS.

Between the lines: The event, like recent developer events from Microsoft and Google, is designed to re-energize coders and sell them on the benefits of developing for the company's platforms.

  • So far, Apple has essentially held firm to its App Store rules and practices despite an antitrust suit from Epic Games, other legal actions from developers and consumers as well as government inquiries.
  • Its concessions have been modest, such as a program announced last year that halves the typical 30% commission rate for small developers who make less than $1 million a year from the App Store.
  • Since the gathering is online rather than in person, Apple could benefit — developers are less likely to be able to share their grievances.

Yes, but: Apple has a lot going for it, including a base of customers that is large, growing and spends more per person on apps than those who use Android.

  • An Apple-commissioned study released this week estimates developers made $643 billion via the App Store, including the sale of digital goods and services, for which Apple takes a commission, as well as via advertising and the sale of physical goods and services, from which Apple does not directly get a cut.
3. Twitter begins testing its subscription service

Image: Twitter

Twitter is rolling out the first iteration of its new subscription offering, Twitter Blue, in Australia and Canada, the company said Thursday. The subscription will cost users in Canada $2.88 monthly and users in Australia $3.44, Sara reports.

Why it matters: Twitter said in February that it's rolling out subscription products to help double its revenue by 2023.

Details: Twitter Blue's design is based on feedback from users. The initial set of new features include:

  1. Bookmark Folders let users manage and organize content so it's easy to find later.
  2. Undo Tweet lets users review and revise tweets before they goes live. Users can set a customizable timer of up to 30 seconds to click "undo" before a message actually posts so they can correct mistakes.
  3. Reader Mode makes it easier for users to consume long message threads by turning them into easy-to-read text.
  4. App customizations will let subscribers personalize the Twitter app icon on their smartphone home screens and unlock new color themes. They will also have access to dedicated customer support.

The big picture: Twitter's core product will remain free. The subscription offering caters to heavy users, many of whom use Twitter professionally.

Go deeper: Twitter debuts subscription products to help double revenue by 2023

4. Quick takes: Treating ransomware like terrorism

1. The Department of Justice plans to start tackling ransomware attack investigations in much the same way it approaches terrorism cases, per Reuters.

  • Our thought bubble: It's past time for a more coordinated and serious response. In addition to the recent Colonial Pipeline and JBS attacks, Cox Media was reportedly the victim of a ransomware incident Thursday that knocked its live video and radio streams off air.

2. A new ad campaign launching today aims to keep former President Trump off Facebook, Axios' Ashley Gold scooped. It comes as the social network faces a deadline to respond to recommendations from its independent Oversight Board about handling speech by political figures. The Verge reports that Facebook will end its controversial "newsworthiness" exemption for national leaders and require them to follow the same set of rules as other users.

  • Our thought bubble: Facebook continues to try to walk a tightrope, trying to assuage concerns from the left that it is subverting democracy and allegations from the right that the company is silencing conservatives.

3. Walmart is giving 740,000 of its workers a ruggedized Samsung smartphone that they can use for both work and personal matters.

  • Our thought bubble: Explicitly allowing workers to use company-provided devices for personal purposes is unusual. But the move could easily pay for itself if Walmart earns just a bit more productivity or loyalty from its vast workforce. Companies made a similar bet two decades ago when they provided or subsidized home PCs.
5. Take note

On Tap

  • Today is National Cheese Day and National Hug Your Cat Day.

Trading Places

  • Facebook named longtime executive Marne Levine as its new chief business officer.
  • Ann Livermore, who spent 30 years at Hewlett-Packard, is joining the board of Samsara.

ICYMI

  • Google removed senior executive Kamau Bobb from his role as global lead of diversity strategy and research after his antisemitic remarks from a 2007 blog post resurfaced this week. (Axios)
  • The EU and U.K. have launched new antitrust investigations into Facebook's role in the classified-ad market. (Axios)
  • Apple is taking additional steps to make sure its AirTag trackers can't be used to surveil people. (CNET)
6. After you Login

This has already been done in music, but an Italian conceptual artist has now managed to sell an "invisible" sculpture for $18,000.

  • My thought bubble: I dunno. I'm not sure I have room for an invisible sculpture. Maybe if he does an invisible painting.
  • My other thought bubble: Hmm, maybe I can do an invisible newsletter. Do you think my editor would notice? (Editor's note: Yes.)