For years, businesses have accused Yelp of running an extortion racket. If companies refused to pay for ads, Yelp would allegedly pull down some of their positive reviews (and wreck sales) until they gave in. Well, those accusations don’t appear to hold much legal water; an appeals court has upheld a California judge’s dismissal of a 2010 class action lawsuit that claimed Yelp was committing civil extortion. Needless to say, the recommendation service is ecstatic. It cites the ruling as proof that the shops simply had an “axe to grind” and were either trying to “draw attention away” from bad reviews or else prop up review manipulation schemes.
Only that’s not really why the court ruled the way it did. As Courthouse News Service notes, the plaintiffs lost because their claims didn’t meet the requirements for an extortion case. They couldn’t demonstrate that they had a right to hold on to those good reviews, or that Yelp had no right to demand payment. In other words, it’s still possible that Yelp was pressuring stores to buy ads at the risk of losing positive buzz; it’s just that no one was entitled to that buzz in the first place. The appeals court was quick to note that this “stringent standard” prevents abuse of extortion laws against upstanding businesses. Whether or not that’s true, the ruling won’t do much to reassure people that reviews accurately reflect a location’s quality — you might want to double-check ratings the next time you’re thinking of visiting an unfamiliar restaurant.
Filed under: Internet
Susan Lyne, the CEO of AOL’s brand group, is stepping down, according to Re/code.
Lyne will now head up an AOL-owned venture fund that promotes women-fronted digital startups.
The “fully funded” and “relatively dormant” venture fund is tentatively called the Build Fund. It will invest in woman-run startups.
AOL told Re/code that investments will primarily be made in companies related to “consumer Internet areas, including e-commerce and media.”
Lyne left Gilt Groupe in February 2013 to come to AOL. Before that, she ran Martha Stewart Living Omnimedia. And prior to that, Lyne was a network executive at ABC. She oversaw the development of series like “Lost” and “Desperate Housewives,” Re/code reports.
Lyne doesn’t intend to waste any time getting started with Build Fund. “We are going to be investing very soon,” Lyne told Re/code. “This is not something that can wait many months — we need to develop a pipeline.”
drag2share: iPhone 6 Sales Will Be So Big That They’ll Move The Needle On Chinese Exports (AAPL, FXI, GMF, EWT, SWKS)
This call is based on forecasts that 100 million iPhones will be sold in the second half of this year, including a record 63 million in the fourth quarter.
Here’s a table of iPhone sales expectations through next year. Apple is expected to announce iPhone 6 next week.
Source: Medialets [download page]
Notes: Mobile ads served in applications had a significantly higher click-through rate (CTR) than those served on the mobile web (0.56% and 0.23%, respectively) during the first half of this year, a finding that aligns with a similar conclusion derived from an Opera study last year. The latest analysis – based on more than 300 billion data points on Medialets’ mobile and tablet ad serving platform – also indicates that ad CTRs were higher on tablets (0.59%) than on handsets (0.41%).
Very, very few YouTube video creators make any real money off of those pre-roll ads, but that might soon change. Google has launched Fan Funding, a new way to tip your favorite YouTube stars directly from the video.
On Monday, Google started sending out press invites to the launch event in India for Android One, its new super-cheap smartphone.
Google is hoping to deliver a solid smartphone experience for less than $100.
Google’s strategy is to work with smartphone developers in emerging markets and to provide them with up-to-date versions of its free Android software so they can make great phones at low prices. It’s the polar opposite strategy of Apple’s, which has the company gearing up for the release of the iPhone 6, likely to cost $700.
The market for cheap smartphones is burgeoning. In the West, smartphones are ubiquitous, but in the developing world, most people don’t have them.
It is not just Google moving in on the emerging market for budget smartphones. Mozilla is launching a $33 phone in India. Microsoft has pushed down the price of its Windows phone. Xiaomi and Motorola have been launching smartphones in India, too, including the Redmi 1S and Moto E costing Rs 6,999 ($115) and Rs 5,999 ($99) respectively.
9to5Google noted that Google had! already partnered with manufacturers Karbonn, Micromax, and Spice for the first Android One devices. Karbonn is the manufacturer that made the A50S, the smartphone priced at only $43.
The bet here seems to be that in the future, it will feel weird to pay large sums of money for a phone. Generally, the history of computing shows that prices drop over time even as devices become ever more powerful. Eventually, Google and its Android manufacturers seem to be hoping, people will face a choice: $700 for an iPhone or $100 for an Android that does the same thing.
Some people think that Android phones compete only with other Android phones and that Apple functions like a separate market. In that scenario, Apple is happy to exist as a minority brand as long as the minority it serves remains highly lucrative.
Right now, that strategy is working for Android, too. Apple remains strong in the U.S., where a huge chunk of the market buys iPhones. But in Europe, Android is taking over. In the top five European countries, Apple’s share is only 7% to 11% of the market.
Of course, Apple’s iPhone 6 is likely to be a huge seller — so after Sept. 9 expect these numbers to change dramatically.
So we know that Twitch’s online broadcasts trump those of WWE and traditional sports, but how does it stack up against cable networks like CNN? According to the New York Times, the game-streaming giant’s peak viewership numbers have surpassed the average prime-time viewers for Headline News, CNN, E!, MSNBC and TruTV since this January. At its best, Twitch had over 720,000 viewers in July alone, but as the NYT points out, it’s still pretty far behind the likes of Netflix and YouTube when it comes to total hours-viewed per month. It’s all pretty fascinating stuff, and there are even breakdowns for what competitive gaming tournament broadcasts are getting the most eyes, too. Spoiler: for this month it’s Riot Games’ League of Legends. Considering that we’ve seen Twitch expanding into more than just gaming broadcasts recently (hosting concerts and even entire conventions) it’s pretty likely that the outfit’s numbers will only continue to climb. Surely Jeff Bezos wouldn’t mind.
Source: New York Times
Alibaba is expected to IPO in September and a new financial report from the company reveals that the Chinese e-commerce giant continues to grow at a blistering pace. The company’s growth pattern, and its recent entrance into the U.S. market, makes Alibaba a serious threat to e-commerce giants like Amazon and eBay.
Alibaba is growing ~50% annually in volume terms.
The gross merchandise volume (GMV) — or, the value of all merchandise — sold on Alibaba’s e-commerce sites reached $248 billion in 2013, 52% more than it sold in 2012.
GMV in the second quarter of 2014 was $82 billion, which is 45% more than the same quarter last year.
Alibaba sells 4X as much stuff in dollar terms as eBay does, and it’s growing much faster.
It’s useful to compare Alibaba and eBay because they are both marketplace businesses — meaning they don’t actually own the merchandise they sell. Rather, retailers, merchants, and consumers use their sites to sell directly to consumers.
Alibaba owns two main e-commerce sites.
- Tmall, an Alibaba site where retailers sell directly to consumers, grew 81% year-over-year in the second quarter.
- Taobao, where consumers sell to other consumers, grew 33% year-over-year and still accounts for the majority of sales via Alibaba.
Mobile commerce is driving an increasing share of Alibaba’s business.
One in three dollars that flowed through Alibaba’s e-commerce sites came from mobile shoppers last quarter, up from 12% one year earlier.
For context, 30% of eBay’s GMV comes from mobile.
More than a quarter billion people bought something through Alibaba in the second quarter.
Alibaba’s customer base is already far larger than eBay’s, and it’s growing much faster.
Alibaba is still very dependent on Chinese shoppers.
Less than 1 in 10 revenue dollars from Alibaba’s e-commerce sites come from customers outside China. However, with the recent launch of its U.S. site 11Main.com, that could soon change. For comparison, almost 40% of Amazon’s revenues come from outside North America.
Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.
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