November 22, 2021
Every year around this time I'm shocked by how short the days get. Nothing could be more predictable! But maybe the sun never sets in the metaverse.
Today's newsletter is 1,151 words, a 4-minute read.
1 big thing: The post-pandemic attention recession
New data shows that there's been a pullback from the historically high levels of media audience growth — and in some cases consumption — during 2020, pointing to signs of a slight "attention recession" in the past few months, Axios' Sara Fischer reports.
The big picture: The COVID-19 pandemic drove a once-in-a-lifetime surge in the attention economy online, but the gradual return of normal life in many places — along with media overload and exhaustion — has down-shifted consumption patterns.
What they're saying: "We're returning to more normal growth levels compared to the pandemic," says Ian Olgeirson, a research director at Kagan, the media research unit of S&P Global. "For 2022, we expect growth to tail off even more so than it has already in 2021," in some sectors.
Details: The retreat from at-home activities has negatively impacted the growth of several media industries on a year-over-year basis.
- Broadband: A new report from Kagan shows that broadband subscriber growth "cooled significantly in the third quarter," stalling in growth for the first time in three years.
- Subscription streaming: Subscription streaming subscriber growth slowed last quarter for most of the major streaming services. "Churn is a challenge as consumers get back to a new normal routine," said Andrew Hare, SVP of research for global media and entertainment at media research firm Magid.
- News: News consumption has plummeted, according to data from SimilarWeb. There's been a 12.4% decrease in readership across the top 10 most visited news sites between October 2020 and October 2021.
Yes, but: This year is still performing better than 2019 in terms of news engagement, per SimilarWeb.
- And despite slowed levels of subscriber growth, household broadband and streaming usage is still higher than 2019.
The bottom line: "I don't think media consumption will go back down to pre-COVID levels," said Seema Shah, senior director of research and analytics, experience at SimilarWeb.
- While we've hit a point of saturation for growth across many subscription sectors, analysts say there's much more room for growth in the U.S. for free, ad-supported streaming.
What to watch: Some of the supply chain issues related to the pandemic will continue to contribute to slowed media growth for the next few months.
- Roku, for example, warned on its latest earnings call that the slowdown in its active account growth rate last quarter was, in large part, "attributable to global supply chain disruptions that have impacted the U.S. TV market."
2. Report: Facebook sidelined hate speech study
Facebook researchers last year assembled a study of the "worst of the worst" hate speech content on the company's platform and made recommendations for how to curtail it, according to a Washington Post report published on Sunday.
But Facebook officials, afraid "the new system would tilt the scales by protecting some vulnerable groups over others" and concerned about "the potential for backlash from 'conservative partners,'" decided against implementing those recommendations, according to the Post.
Details: The researchers asked thousands of Facebook users in 2019 to rank a series of abusive posts, and respondents, even white conservatives, consistently found those aimed at minority groups to be the most harmful.
- Examples of the "worst of the worst" postings included obscene sexist and racist comments aimed at the progressive Democratic representatives known as "the Squad."
- Yet, the report found, Facebook's automated hate-speech detection algorithm tended to "aggressively [detect] comments denigrating white people more than attacks on every other group," per the Post.
The researchers recommended retuning the system to flag and delete hate speech targeted at Black, Jewish, LGBTQ, Muslim and mixed-race people, since the survey found those posts to be "the worst of the worst."
Yes, but: Facebook leadership rejected the plan and stuck to the company's "politically neutral" stance.
- In a statement to the Post, Facebook spokesman Andy Stone said the company had implemented parts of the report's recommendations, but after a rigorous internal discussion about these difficult questions, we did not implement all parts as doing so would have actually meant fewer automated removals of hate speech."
The big picture: Facebook's content moderation policies have been in the media spotlight after a trove of documents from whistleblower Frances Haugen chronicled a variety of harms to users.
3. The high cost of the crypto Constitution bid
The 17,000+ cryptocurrency enthusiasts who collectively funded a losing $40 million bid to purchase a copy of the U.S. Constitution last week face a new hurdle in getting their money back: transaction fees.
How it works: The ConstitutionDAO group used Ethereum to build its war chest, and contributors paid "gas fees" — essentially, network transaction costs — that observers estimated to run about $50 per transaction.
- That didn't mean much to big-ticket participants, but took a big bite out of smaller contributors. The median contribution size was a little over $200, according to the ConstitutionDAO site.
- Participants in the bid collectively spent nearly $1 million on the gas fees, according to one estimate.
The catch: Organizers announced over the weekend that they'd be returning contributors' Ether contributions, but each participant would have to pony up another gas fee for this new transaction.
Between the lines: Transaction costs have long been the bane of all sorts of currency and payment innovations and are one reason that micropayments have never taken off.
- Crypto supporters point out that credit card systems still take a hefty 2% to 3% per transaction.
What's next: Ethereum has plans to streamline its system in ways that might reduce transaction costs, while a slew of new systems are competing to take its place with more efficiently-tooled blockchain systems that cost less to run.
4. More buzz on Apple's autonomous vehicle plans
Bloomberg had fresh reporting Friday on Apple's secretive plans to develop an autonomous electric car, Axios' Ben Geman writes.
Driving the news: Apple plans to "accelerate development" and is "refocusing the project around full self-driving capabilities."
- The target launch date is 2025, but could easily slip, according to Bloomberg's story, which is attributed to anonymous sources familiar with the effort.
Why it matters: If the plan ever comes to fruition, it would mark a major new entrant in the auto space, given Apple's brand recognition, balance sheet and track record — and a major new chapter for Apple.
Yes, but: Apple keeps its cards close to the vest, and the effort has long been a moving target.
What they're saying: Wedbush Securities analysts said Bloomberg's reporting matches their view that an Apple car — probably in partnership with another company — will likely arrive mid-decade.
- "We would assign the chances of Apple unveiling its own standalone car by 2025 as 60%–65%," they said in a note.
5. Take note
- Dare we say, a quiet week pre-turkey?
- RIP Jay Last, one of the "Traitorous Eight" — the group of young engineers in the 1950s who ditched their boss, William Shockley, to found Fairchild Semiconductor and shape Silicon Valley.
- An Apple internal memo affirms employees' right to discuss compensation. (NBC)