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Blockchain, Cats and the idea of “Infinite Extensibility”

Last December, a new game became an overnight mega-trend in the blockchain world. CryptoKitties allowed users to buy, own, and trade unique collectible cartoon cats on the blockchain. Around the time of launch, CryptoKitties was so successful that it slowed the Ethereum network.

This is a big deal, as the Ethereum blockchain is, without a doubt, the most active smart contract platform in existence. Of the top 100 tokens by market cap, 94% are built on top of Ethereum. Of the top 800 tokens, 87% are built on Ethereum. Most of these tokens are ERC20 tokens, which made possible the majority of the $5.5 billion raised through ICOs in 2017 and the $6.5 billion raised in token sales during just the first quarter of this year.

The driving principle behind the creation of CryptoKitties was to demonstrate the potential of Ethereum and the blockchain ecosystem for trading and securing digital assets. In the white paper, the founders discuss the narrow focus of most blockchain projects on payments. Ultimately, they hoped CryptoKitties would help people expand their vision of what a blockchain could do.

A few weeks back Digital in Asia met with Benny Giang, the founder of CryptoKitties, to talk Ethereum, cats and art on the blockchain.

Digital in Asia: So Benny, where did the inspiration for CryptoKitties come from? How did it start?

Benny: We love cats, and we know it’s a fact that the internet and cats is just married, right? Basically any new internet technology always starts with cats.

We also thought that blockchain seemed pretty interesting, but we wanted to make it more accessible. We saw so many ICOs happening, and we loved the variety. Some were solving really big interesting problems, like world hunger level. But there were some that were just … I don’t even know what they were doing. It’s just getting DJ Khaled to hype up their ICOs! It felt like what was missing was the education and accessibility piece. So we had the idea of putting cats on the blockchain to drive our education and accessibility agenda.

This turned our attention to a couple of existing crypto collectibles like CryptoPunks and Spells of Genesis. These were the first to use the ERC20 token standard from Ethereum, and then create a collectible on the blockchain. But the limitation with the existing collectibles was that they were only an image. We wanted to take it to the next level. So we started exploring the game play, and we arrived on this interesting idea of allowing people to breed their kitties on the blockchain.

We then spent a month on genetic simulations, trying to figure out how deep we could go and how we could evolve the idea. We established a 256 bit genome. That results in about 4 billion variations of kitties. In terms of human genetics, that’s nothing, it’s very controllable. But in game play, 4 billion potential kitties is quite a lot of variations. It was more of an experiment, playing around, and that was the initial genesis of CryptoKitties.

Digital in Asia: Where did you get started with blockchain? Because it seems as if you were already very familiar with the technology. CryptoKitties was more about doing something in blockchain, as opposed to doing CryptoKitties.

Benny: It started in the spring of 2017. I began reading more, specifically on Ethereum. Most of our team, except a couple of members, were already involved in blockchain, the Bitcoin side. They mined Bitcoin, they bought them, they sold them from way back.

From a more typical internet technology perspective, a lot of the product teams and my background was around building B2B Enterprise SaaS Software. I was interested in the concept of the world computer, and creating a decentralised app store to build real utility. That’s really fascinating, and the whole decentralised aspect really caught my attention.

But I love the quote: “Any disruptive technology starts off as a toy”. And in there I saw the opportunity to bring the educational piece forward, in a way that people could learn, but also have fun.

Digital in Asia: Crypto can be complicated. How long did you think it would take people to get their heads around digital wallets, Gas price and all the other complexities of blockchain, and Ethereum specifically.

Benny: In the first week about 80,000 people signed up. These are new users we had never interacted with, and probably don’t even know what a digital wallet is. So that was already a huge factor. 80,000 new people were so attracted to this game that they were willing to jump through all these hoops.

My biggest goals always involve optimizing the experience for the end user. That’s all I care about, that’s all our team cares about. But in blockchain, and Cryptokitties, we’re still pretty far away from having it where you click on the button and everything just works.

Are people scared of Gas and all these things? I would say they are. Sometimes Gas price goes up and they don’t understand why, but that’s kind of our role, and part of why we created the game. Right now we’re building a whole new onboarding process that will help educate: “Hey this is what Gas is, this is why we need it, this is why it keeps fluctuating.” So people will understand.

Digital in Asia: Why did you decide to build on the Ethereum blockchain? There are alternative blockchains out there like Neo, and as we’ve seen with Gas price increases, and congestion, it’s not always an easy environment.

Benny: It was a timing thing and also more of a mission alignment thing. We met some of the Ethereum team last year and saw that these people really do have the builder mentality, they’re very product focused and development focused. Looking at other blockchains there is potential scalability, but in terms of full production readiness, with thousands of dApps already built on top of it, and battle tested, I would say there is only one at this point.

There are some blockchains being talked about in terms of being Ethereum killers, and that may be true, but let’s see when they get full production ready. Practically, if we were to consider these other chains then we wouldn’t have launched CryptoKitties when we did, as we would’ve waited six more months. It was more of we need to do it now, and we need to ship the product because the timing was right, it was when ICOs were popping like crazy. But as you know we didn’t do an ICO. We actually did the reverse ICO where we built the product, and we sold people kitties!

Digital in Asia: Where is CryptoKitties going? What are your future plans?

Benny: We’re going to work towards deepening the user experience. That means more game play features and expanding to new ways of thinking about the platform. It’s very interesting the three areas we play in. One is crypto, the other one is gaming and the final area is art. We were invited to the Rare Art Festival New York, and we asked a bunch of people to basically talk about this new contemporary art form which is digital collectibles. And some people laughed, definitely.

Screenshot-2018-04-10-at-11.24.05

What’s interesting to me is these Kitties will live for thousands of years. What we have done is basically made history. No matter if we are alive, or the company is alive, these kitties will live. We have this concept of infinite extensibility which is related to the kitties as art form.

Digital in Asia: This is an interesting area. What do you mean by infinite extensibility?

Benny: You buy a painting, let’s say it’s the Mona Lisa. It’s pretty old. You just keep it, and you just look at it, right? And as it ages with time, it just deteriorates. But with the digital collectibles as an art form, as time passes, more functionalities can be added. Right now all you can do is buy and sell and breed. But what if you could walk it, what if this kitty could be a real kitty in your mind. So it’s like an art piece that you can continually interact with as time progresses.

Digital in Asia: It’s apparent you’re not actually a blockchain business, you’re a gaming or collectibles business. Blockchain is just the technology you’re building your business on, in the same way that the internet is the technology that Uber or Amazon build their business on. But we don’t – for the most part – talk about that any more. Every business built on the blockchain right now is called a blockchain business, and this is just about the early stage nature of the space really. What other projects do you feel are good enough to transcend blockchain, and become real businesses?

Benny: The whole blockchain gaming and collectibles category is going to be huge this year. In regards to ICOs, there are a few products I find interesting. They’re more related to AI blockchain, and the convergence of the two. But I don’t actively get involved with many ICOs because the space is almost too hot right now. I would rather hang around the people who are developers or product people, who focus on the end view. There is so much work to do on protocols, all these different things. If we want more businesses to transcend blockchain, we need better and more secure blockchain platforms.

Digital in Asia: Okay. On that, are there any ways in which Ethereum limits you?

Benny: Limitations? We really support the Ethereum ecosystem. We have a team of six that are focused on long term scaling of Ethereum, talking to other chains, working with side chains, trying to find the right solutions. Introducing Casper, or at least the MVP of Casper, will be a big milestone for Ethereum this year. If they pull it off without doing a super hard fork, and the community comes to a consensus, they’re going to be way ahead of other people. Because again, they really have the masses, they just need to move the masses to the next level.

Digital in Asia: Do you think there is a danger that they won’t successfully deliver, or build consensus around, sharding or proof-of-stake? We don’t want Ethereum Classic 2.

Benny: No, No, No. Nobody wants that. Ethereum is below 600 dollars right now, which is low compared to a few months back. When CryptoKitties started it was at 400 dollars. So it’s back to a level of normality for us. It’s good for everybody to calm down, and come together around common goals, because we need to think long term. We all know the market was bound for a correction, and while that’s sad because I own Ethereum, it’s good as it lowers costs to build and operate on the blockchain.

Digital in Asia: What plans do you have around mobile? Any sort of AR functionality? People think it would be cool to see your kitties.

Benny: We have launched a mobile version of CryptoKitties in Asia. There are Chinese focused collectibles, and we’re looking at Singapore, Taiwan, and Hong Kong. China feels a bit difficult to get into, but we’ll see.

Considering new features like AR as a blockchain gaming company who really believes in the philosophy of decentralisation is tricky. If you walk your cat, should that be on a blockchain? When you have a kitty for a thousand years, we think that entire history – including any AR excursions – should be logged. But that’s not easy, and we can’t handle all of the transactions yet. But we are brainstorming a bunch of these new gaming features because that will help keep the experience interesting.

Digital in Asia: Thanks for your time Benny. This has been an interesting conversation. Any final words of advice?

Benny: Blockchain is only just getting started. Thanks again.

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Data to Drive the Next Era for Media Businesses

paula_minardi_ooyala
Paula Minardi, Head of Content Strategy, Ooyala

The State of the Media Industry 2018 report confirmed: data is the key driver of businesses in media organisations and data-driven video is the way to go.

From consumer engagement and privacy to technological advances, content strategies and monetisation, data in its various forms is everywhere and companies are challenged with harnessing and analysing it smartly for greater returns.

Here are some of the top trends driving media companies:

  1. Mobile and Social – What Consumers Want

Audiences today expect video to be on mobile. According to Ooyala’s Q4 2017 video index, mobile’s share of video plays in Asia-Pacific surpassed 60% and the medium had the most share of plays amongst other devices in the region.

It is thus unsurprising that companies have evolved their digital strategies according to consumers’ media consumption habits. In the U.K., The Guardian’s Mobile Innovation Lab has experimented with elements like offline mobile news content for commuters to improve mobile news delivery.

Social media video continues to grow, driving media companies to lean more on social to promote and enhance their content, and grow their audiences. Content, strategic partnerships, innovation and branding are key to their growth in the future.

  1. Data and A.I. for Greater Efficiency

For greater content production and publishing efficiencies, media organisations are looking at deep data, automation and artificial intelligence (A.I.). The BBC, for example, has turned to technology to help personalise content across India.

The focus on more granular applications of asset metadata has also led companies to A.I. capabilities. The data-driven Ooyala Flex Media Platform, which connects and streamlines the entire content supply chain, works with Microsoft Video Indexer cognitive services to help media companies search their content archives for video, audio or text files with facial recognition, language translation, visual text identification, and more.

  1. Immersion with AR and VR

With mobile devices getting more ubiquitous and advancements in 5G connectivity, we’re looking towards a future of more immersive video content, thanks to continuous progress developing virtual reality (VR), 360-degree video, and augmented reality (AR) technology.

A study confirmed that VR increases viewer engagement with journalism, particularly with larger-scale experiences.

Additionally, VR360 ads were found to perform better than traditional ads. The advanced Ooyala Player is enabling media companies’ aspirations in the VR and 360-degree video arena by supporting VR360 playback for VOD and live.

The interest for AR is rising within the industry as well. Consider The New York Times’ integration of AR into its stories, including features published during the 2018 Winter Olympics.

Data at the centre

As media companies strive to be innovative in monetising content and diversifying revenue streams, it is data that will increase their chances for success and lead them into the next era of media.

Mobile App Predictions for 2018

[Photo] Jaede Tan, Regional Director, App Annie
Jaede Tan, Regional Director of App Annie
2018 marks the 10 year anniversary for both the Apple App Store and Android market. In the short time since the first wave of apps were published in 2008, they have impacted the lives of people all over the world on an unprecedented level. There are now apps for almost anything and everything – hugely successful apps that incorporate AR and VR, apps dedicated to events, and even an app just for popping bubble wrap.
Who could ever have imagined that apps would evolve from the simple Snake game on the Nokia phone (yes that was an app), to driving a $6.3 trillion industry in 2021?
Looking back over 2017, the app economy has hit some significant milestones:
  • By the end of October 2017, the iOS App Store and Google Play had more than 2 million and more than 3.5 million apps available, respectively.
  • New apps continue to be introduced at a strong pace. During the month ending October 31, 2017, roughly 50,000 new apps launched on the iOS App Store and over 150,000 were added to Google Play.
  • Across mature markets, users have up to 90 or 100 apps installed on their devices, 30 of which they use on a monthly basis. On average, people are spending two hours per day — which equates to one month out of every year — in apps.
  • More than 40 countries will generate over $100 million in consumer spend in 2017 for iOS App Store and Google Play combined.
  • Apps play a key role in almost every industry today, including retail, banking, travel, QSR, CPG and media & entertainment .

It is apparent that the evolution of mobile apps have transformed the everyday lives of people, and users continuously expect their favourite apps to be improved. There are several aspects of an app which users expect to be improved, but convenience is a core theme that underlies many of our predictions as we look to 2018.

1. Worldwide Gross Consumer App Store Spend Blows Past the $100 Billion Mark

The continued evolution of markets across the globe has led app monetization to continuously grow at an outstanding rate. Apart from games, which traditionally account for the majority of overall spend, we foresee spending in e-commerce apps such as Alibaba and Amazon to drive worldwide consumer spend – which is expected to grow about 30% year on year to exceed $110 billion in 2018. In APAC, consumer spend on apps hit $17.1 billion in H1 2017 alone.

2. App Store Curation Drives Higher Overall IAP Revenue and Expands Opportunity for Independent Publishers

In June 2017, both Apple and Google announced updates to the iOS App Store and Google Play aimed to alleviate this issue through app curation and editorial content. We predict that these updates will have a significant impact on apps in 2018, in particular apps that help people occupy their leisure time. These types of apps, which tend to be entertainment-centric, are most likely to connect with consumers when they are casually browsing through the app stores. Conversely, “needs-based” apps such as UberEats or DBS PayLah! are far more likely to be downloaded based on word of mouth recommendations or focused searches when a user encounters a particular need.

3. Broader Adoption of AR Apps

Pokémon GO and Snapchat sparked huge interest in augmented reality (AR) among the masses, and we foresee that AR will take another significant step forward towards realizing its massive potential in 2018.

Facebook, Google and Apple have taken the lead at their developer conferences in 2017, and together with the Chinese powerhouses Alibaba , Baidu and Tencent , have set the foundation for AR-related initiatives. These initiatives will accelerate the space by making it easier and faster for publishers to develop AR apps, while also stoking consumer interest. For example, in Japan, starting in May 2017, there has been a significant increase in iPhone app downloads for the top ranking apps by “Augmented Reality” app store search in Japan, and other APAC countries.

apps ar japan

4. Fragmentation of the Video Streaming Space Accelerates

It is now not an uncommon sight to see people catching up on their favourite Netflix series or Hollywood movies while on the move. 2017 has been another extraordinary year for video streaming services and total time spent in Video and Entertainment apps tripled to almost 40 billion hours in APAC alone.

video streaming apps

Between H1 2015 and H1 2017, time spent in the Video Players and Entertainment categories on Android phones in APAC has tripled to reach close to 40 billion hours – almost half of the worldwide total.

Year to date through October 31, 2017, these apps have driven significant growth of worldwide consumer spend for the Entertainment category on both iOS and Google Play. However, as some of the biggest names in the entertainment industry and app economy — including Netflix , Apple , Google , Facebook , Snap and Disney — have announced huge plans to expand their footprints in variety of ways, we expect that 2018 to mark the beginning of an inflection point for this space, in terms of fragmentation. In fact, our research shows that Android users in South Korea who use video streaming apps are significantly more likely than average to be accessing other video and related entertainment services.

Overall, this space will continue to see steady growth in terms of revenue and engagement, but in the years that follow, consumers may start to rationalize how they spend their time and money among a dizzying array of choices, resulting in some players succumbing to profit pressures as they get crowded out of this competitive space.

5. Mobile Pushes Towards the Center of the Retail Customer Journey

Analysts and experts have pronounced the retail apocalypse in recent times, and we see apps as a way to reinvigorate consumers’ retail experience. Brick-and-mortar retailers have already embraced apps and shoppers are now very engaged; results are telling from the Great Singapore Sale 2017 , which saw an increase in sales thanks to the GoSpree app. In Indonesia, which has a population of 261 million and a burgeoning middle class, users spend an average of just over 90 minutes per month in Shopping apps, placing it at #2 after South Korea. On 11 November 2017, dubbed Single’s Day, Alibaba generated a record breaking $25.3 billion in sales, with mobile users accounting for 90% of sales. These numbers are only the beginning of what is a rapidly evolving retail experience for consumers.

Come 2018, apps will continue to cause consumers to change their shopping habits which will in turn redefine the relationship between and even the very nature of existing retail channels (e.g., mobile app, web, brick-and-mortar). China, for instance, is one huge influencer in this area. We are seeing people in western markets increasingly use physical stores as a place to pick up items purchased on mobile. In addition, cash registers’ longstanding role in the checkout and payment process will become reduced, or in some cases replaced, by mobile. For many consumers, mobile will be a core part of the shopping experience regardless of channel.

6. Restaurant Aggregators Drive Mobile Conversion as Delivery-as-a-Service Further Penetrates Premium Markets

As we predicted last year, there was some consolidation in the food delivery space. Looking ahead to next year, we expect that aggregators such as Korea’s Yogiyo will continue to expand the addressable market for this space by opening up under penetrated markets as well as converting users who do not currently use mobile apps from intermediaries to order meals. Meanwhile, delivery as a service (DaaS) providers (e.g., UberEATS , Deliveroo) will gain market share in premium markets where customers are more likely to pay more for higher-end restaurants that don’t have their own delivery fleets. Furthermore, we expect more quick-service restaurants (QSR) to respond to the increased competition from food delivery by partnering with DaaS apps, similar to McDonald’s growing partnership with UberEATS . As with video streaming, this space will face consolidation in later years as it needs to rationalize the fragmentation felt by customers and the profit pressures felt by service providers competing in a crowded space.

7. Finance-Related Apps Poised for Most Significant Transformation in 2018

In 2017 in Asia-Pacific specifically, the growth of downloads in the Finance category outpaced all app categories (non-games) combined, with China leading the way. Person-to-person (P2P) payment apps, like WeChat, AliPay, GoPay, Grab Pay and PayTM have been some of the shining stars in the fintech app revolution. They have transformed how consumers, particularly millennials, exchange money, by displacing the use of cash and checks. In the next year, we expect these services to capitalize on their popularity and broaden their range of services in an effort to expand their revenue potential, fend off increased competition from traditional banks and deepen user engagement. With retailers adopting such apps as an option for customers, we expect P2P payment apps to see increased transaction volume. These initiatives have been well received by users, as they will provide even greater levels of convenience. In addition, this space will see increased activity from successful players in other categories, like messaging and social networking, who are constantly looking for additional ways to serve, monetize and engage their large user bases.

These are just a handful of areas where we expect the app economy to evolve over the near future. Despite how far this space has advanced over its first decade, it is just scratching the surface of its full potential. Users increasingly expect apps to completely transform the very nature of how they accomplish goals and tasks, as well as create brand new experiences not possible on other platforms. We are excited to see how app developers change the world by delivering on these needs over the app economy’s second decade.

Augmented Reality and Machine Learning to Impact Marketing in 2017

2016 was an eventful year for marketers: New technologies such as Augmented Reality (AR) and Virtual Reality (VR) captured the imaginations of marketers globally – as Nintendo’s new AR offering, Pokémon Go, took the world by storm. 2016 was also a big year for digital transformation (DX), as enterprises rapidly prioritised DX at the center of their corporate strategy, and marketers rapidly embraced data analytics in order to drive marketing decisions.

marta-adobeMarta DeBellis, Adobe APAC Vice President of Marketing offers her views on some big milestones and game changers that will shape the digital marketing landscape, as we move into 2017.

1. AR, VR and Machine Learning will continue to have an impact in 2017:

  • The emergence of technologies like AR, VR and machine learning will shape marketing in 2017 and beyond. AR and VR will change the way marketers can engage with customers and drive experiences beyond what is possible today. AR and VR will change the way marketers can engage with customers and drive experiences beyond what is possible today. The challenge for marketers will be to learn how to create content for these formats to fully leverage the opportunities they offer.
  • Machine learning and data science will offer significant productivity opportunities for marketers, allowing them to focus their time on their overall strategies and away from day-to-day analytics and data management. Artificial Intelligence (AI) and machine learning have become ubiquitous in the technology industry, and a lot of great work has been done to build out horizontal frameworks to solve large-scale problems – from accurate speech recognition to computer vision.
  • We recently introduced Adobe Sensei, a framework and set of intelligent services, with deep expertise in AI, machine learning and deep learning, built into the Adobe Cloud Platform which dramatically improve the design and delivery of digital experiences.
  • Understanding how customers are consuming video content remains an opportunity for marketers in 2017. Video has been the ‘next big thing’ for several years now and I don’t think marketers have it all figured out yet. Marketers will get one more shot at leveraging this opportunity fully next year. Adobe’s acquisition of TubeMogul shows our focus on video in marketing campaigns. It will create the first end-to-end independent advertising and data management solution that spans TV and digital formats, simplifying what has been a complex and fragmented process for brands.

2. Competitive advantage (through exceptional CX) will be the biggest driver of digital transformation

  • Competitive advantage is the biggest driver of digital transformation and underlying that is customer experience. 
  • Customer experience is the new competitive differentiator of success and is separating those brands which are pushing ahead with transformation, and those trapped in a business model of yesterday. Today’s digital landscape is overflowing with people interacting across multiple devices, whether it’s mobile devices, wearables, tablets or even car dashboards. When new products and innovation come onto the market, people want to be able to use it. The increased expectations of consumers have brought us to a tipping point where experience must be at the center of everything brands do.
  • In 2017 marketers need to walk in the shoes of customers and truly understand the experience their brand is offering. Customers are interacting with brands across many different touchpoints and marketers need to be aware of how this experience affects the overall customer journey.

3. Digital marketers must still place emphasis on creativity.

  • Data has given marketers the power to demonstrate ROI and drive business growth. However, it’s crucial they remember that creativity still plays a significant role. Creating amazing content that is personal and emotive is key to delivering incredible customer experiences.
  • Creativity and design-led thinking are central to business success. Adobe’s 2016 Creative Pulse survey highlights an overwhelming number of respondents who think so. 89% of APAC respondents say their businesses are placing more importance on creativity and design thinking. 56% of APAC respondents feel that they are creating a bigger impact within their organizations, compared to two years ago.
  • Content velocity – being able to create amazing content quickly, and at scale, should also be a focus for marketers in 2017. The key is to not make more content, but to make content more personalized and engaging.