Connected TV (CTV) menggeser lanskap Iklan

Disadur dari artikel eMarketer dengan  judul TV is changing marketing budgets and teams

Connected TV (CTV) mengubah lanskap periklanan dengan lebih dari satu cara. Menurut laporan baru dari MNTN dan Digiday, banyak pengiklan tidak hanya memasukkan CTV ke dalam strategi media mereka, namun juga merestrukturisasi organisasi internal mereka untuk mendukung inisiatif ini dengan cara berbeda.

Merujuk pada hasil survei 123 pengiklan merek dan agensi, 35% pengiklan menggunakan pendekatan hibrida, yang mencakup tim brand dan kinerja, untuk mengelola iklan dan strategi CTV mereka. Pendekatan ini menunjukkan keunggulan bawaan CTV sebagai saluran iklan. Seperti TV linier, CTV berguna untuk kampanye pencitraan merk, dan penargetan pemirsa dan kemampuan pengukurannya juga menjadikannya saluran kinerja yang sangat efektif. Bagi tim yang biasa mengevaluasi kinerja dari marketing web, penelusuran berbayar, dan saluran sosial berbayar, hal ini penting untuk mendorong keterlibatan dan konversi konsumen. 

Anggaran bergeser dari TV linier dan Media Sosial ke CTV

Hasil survey juga menunjukkan, 58% mengatakan telah mengalihkan anggaran dari TV linier ke CTV. Hal ini tidak terlalu mengejutkan, karena pemirsa telah melakukan perubahan yang sama, sedikit menonton TV dan lebih banyak streaming televisi, sejak beberapa tahun belakangan ini. Yang mungkin mengejutkan adalah bahwa 41% pengiklan mengatakan bahwa mereka mengalihkan juga anggaran dari saluran media sosial berbayar mereka.

Salah satu penjelasan terkait pergeseran belanja sosial ke CTV adalah perubahan iOS 14 baru-baru ini, yang meminta pengguna untuk ikut serta dalam pelacakan data aplikasi seluler. Media sosial sangat bergantung pada aplikasi seluler untuk mendorong bisnis periklanan mereka, dan perubahan privasi Apple melihat persentase pengguna yang rendah untuk ikut serta dalam pelacakan. Angka keikutsertaan di seluruh dunia hanya 11% sejak mulai berlaku pada April 2021, dan tidak banyak meningkat sejak itu.

Hai ini mempengaruhi pembelanjaan iklan media sosial dan mengubah cara pemasar melihat posisi strategi pemasaran mereka. Setelah saluran direct response yang dapat secara konsisten mendorong konversi, perubahan privasi data telah membatasi efektivitas media sosial dalam memberikan jenis kinerja yang biasa dilakukan pengiklan. Pada gilirannya, mereka mencari opsi lain, dan tampaknya CTV adalah alternatif yang populer.

CTV mewakili alternatif iklan direct response

Karena CTV dapat menargetkan pemirsa tertentu dan mengukur hasil yang terkait langsung dengan promosi, seperti kunjungan situs web maupun konversi, pemasar dapat menggunakannya dengan cara yang sama seperti media sosial berbayar. Terlebih lagi, ada beberapa sinergi kreatif antara kedua saluran—materi iklan video yang ada yang digunakan di media sosial dapat dialihkan untuk berjalan di CTV dengan beberapa penyesuaian untuk memenuhi kualitas dan waktu tayang.

Dengan perubahan anggaran serta tim merk dan kinerja untuk memanfaatkan peluang, CTV terbukti menjadi saluran iklan yang tangguh di industri ini. Dikombinasikan dengan fakta bahwa kondisi ini masih sangat awal dalam pengembangannya, CTV bisa menjadi bagian yang dominan untuk beberapa waktu mendatang.

Telco edge computing (1)

Taken and extracted from STL Partner's article Telco edge computing: What’s the operator strategy?, May 2020

Edge computing is a strategic opportunity for telcos. We examine the driving needs and applications for telco edge computing, describe the market and the options for telcos, discuss their partnerships with hyperscalers and recommend key actions.

Edge computing can help telcos to move up the value chain

The edge computing market and the technologies enabling it are rapidly developing and attracting new players, providing new opportunities to enterprises and service providers. Telco operators are eyeing the market and looking to leverage the technology to move up the value chain and generate more revenue from their networks and services. Edge computing also represents an opportunity for telcos to extend their role beyond offering connectivity services and move into the platform and the application space.

However, operators will be faced with tough competition from other market players such as cloud providers, who are moving rapidly to define and own the biggest share of the edge market. Plus, industrial solution providers, such as Bosch and Siemens, are similarly investing in their own edge services. Telcos are also dealing with technical and business challenges as they venture into the new market and trying to position themselves and identifying their strategies accordingly.

Telcos that fail to develop a strategic approach to the edge could risk losing their share of the growing market as non-telco first movers continue to develop the technology and dictate the market dynamics. This report looks into what telcos should consider regarding their edge strategies and what roles they can play in the market.

We focus on:

1. Edge terminology and structure, explaining common terms used within the edge computing context, where the edge resides, and the role of edge computing in 5G.
2. An overview of the edge computing market, describing different types of stakeholders, current telecoms operators’ deployments and plans, competition from hyperscale cloud providers and the current investment and consolidation trends.
3. Telcos challenges in addressing the edge opportunity: technical, organisational and commercial challenges given the market.
4. Potential use cases and business models for operators, also exploring possible scenarios of how the market is going to develop and operators’ likely positioning.
5. A set of recommendations for operators that are building their strategy for the edge.

What is edge computing and where exactly is the edge?

Edge computing brings cloud services and capabilities including computing, storage and networking physically closer to the end-user by locating them on more widely distributed compute infrastructure, typically at smaller sites.

One could argue that edge computing has existed for some time – local infrastructure has been used for compute and storage, be it end-devices, gateways or on-premises data centres. However, edge computing, or edge cloud, refers to bringing the flexibility and openness of cloud-native infrastructure to that local infrastructure.

In contrast to hyperscale cloud computing where all the data is sent to central locations to be processed and stored, edge computing local processing aims to reduce time and save bandwidth needed to send and receive data between the applications and cloud, which improves the performance of the network and the applications. This does not mean that edge computing is an alternative to cloud computing. It is rather an evolutionary step that complements the current cloud computing infrastructure and offers more flexibility in executing and delivering applications.

Edge computing offers mobile operators several opportunities such as:

• Differentiating service offerings using edge capabilities
• Providing new applications and solutions using edge capabilities
• Enabling customers and partners to leverage the distributed computing network in application development
• Improving network performance and achieving efficiencies / cost savings

As edge computing technologies and definitions are still evolving, different terms are sometimes used interchangeably or have been associated with a certain type of stakeholder. For example, mobile edge computing is often used within the mobile network context and has evolved into multi-access edge computing (MEC) – adopted by the European Telecommunications Standards Institute (ETSI) – to include fixed and converged network edge computing scenarios. Fog computing is also often compared to edge computing; the former includes running intelligence on the end-device and is more IoT focused.

These are some of the key terms that need to be identified when discussing edge computing:

• Network edge refers to edge compute locations that are at sites or points of presence (PoPs) owned by a telecoms operator, for example at a central office in the mobile network or at an ISP’s node.
• Telco edge cloud is mainly defined as distributed compute managed by a telco.  This includes running workloads on customer premises equipment (CPE) at customers’ sites as well as locations within the operator network such as base stations, central offices and other aggregation points on access and/or core network. One of the reasons for caching and processing data closer to the customer data centres is that it allows both the operators and their customers to enjoy the benefit of reduced backhaul traffic and costs.
• On-premise edge computing refers to the computing resources that are residing at the customer side, e.g. in a gateway on-site, an on-premises data centre, etc. As a result, customers retain their sensitive data on-premise and enjoy other flexibility and elasticity benefits brought by edge computing.
• Edge cloud is used to describe the virtualised infrastructure available at the edge. It creates a distributed version of the cloud with some flexibility and scalability at the edge. This flexibility allows it to have the capacity to handle sudden surges in workloads from unplanned activities, unlike static on-premise servers.

 Figure 1 shows the differences between these terms.

Network infrastructure and how the edge relates to 5G

Discussions on edge computing strategies and market are often linked to 5G. Both technologies have overlapping goals of improving performance and throughput and reducing latency for applications such as AR/VR, autonomous vehicles and IoT. 5G improves speed by increasing spectral efficacy, it offers the potential of much higher speeds than 4G. Edge computing, on the other hand, reduces latency by shortening the time required for data processing by allocating resources closer to the application. When combined, edge and 5G can help to achieve round-trip latency below 10 milliseconds.

While 5G deployment is yet to accelerate and reach ubiquitous coverage, the edge can be utilised in some places to reduce latency where needed. There are two reasons why the edge will be part of 5G:

• First, it has been included in the 5G standards (3GPP Release 15) to enable ultra-low latency which will not be achieved by only improvements in the radio interface.
• Second, operators are in general taking a slow and gradual approach to 5G deployment which means that 5G coverage alone will not provide a big incentive for developers to drive the application market. Edge can be used to fill the network gaps to stimulate the application market growth.

The network edge can be used for applications that need coverage (i.e. accessible anywhere) and can be moved across different edge locations to scale capacity up or down as required. Where an operator decides to establish an edge node depends on:

• Application latency needs. Some applications such as streaming virtual reality or mission critical applications will require locations close enough to its users to enable sub-50 milliseconds latency.
• Current network topology. Based on the operators’ network topology, there will be selected locations that can meet the edge latency requirements for the specific application under consideration in terms of the number of hops and the part of the network it resides in.
• Virtualisation roadmap. The operator needs to consider virtualisation roadmap and where data centre facilities are planned to be built to support future network
• Site and maintenance costs. The cloud computing economies of scale may diminish as the number of sites proliferate at the edge, for example there is a significant difference in maintaining 1-2 large data centres to maintaining 100s across the country
• Site availability. Some operators’ edge compute deployment plans assume the nodes reside in the same facilities as those which host their NFV infrastructure. However, many telcos are still in the process of renovating these locations to turn them into (mini) data centres so aren’t yet ready.
• Site ownership. Sometimes the preferred edge location is within sites that the operators have limited control over, whether that is in the customer premise or within the network. For example, in the US, the cell towers are owned by tower operators such as Crown Castle, American Tower and SBA Communications.

The potential locations for edge nodes can be mapped across the mobile network in four levels as shown in Figure 2.

Figure 2: possible locations for edge computing

Telco edge computing (2)

 

Taken and extracted from STL Partner's article Telco edge computing: How to partner with hyperscalers, August 2020

Telcos and hyperscalers want to capture the value at the edge, but they need to work together to deliver of edge computing solutions and generate demand among customers. 

Edge computing is getting real

Hyperscalers such as Amazon, Microsoft and Google are rapidly increasing their presence in the edge computing market by launching dedicated products, establishing partnerships with telcos on 5G edge infrastructure and embedding their platforms into operators’ infrastructure.

Many telecoms operators, who need cloud infrastructure and platform support to run their edge services, have welcomed the partnership opportunity. However, they are yet to develop clear strategies on how to use these partnerships to establish a stronger proposition in the edge market, move up the value chain and play a role beyond hosting infrastructure and delivering connectivity. Operators that miss out on the partnership opportunity or fail to fully utilise it to develop and differentiate their capabilities and resources could risk either being reduced to connectivity providers with a limited role in the edge market and/or being late to the game.

Edge computing or multi-access edge computing (MEC) enables processing data closer to the end user or device, on physical compute infrastructure that is positioned on the spectrum between the device and the internet or hyperscale cloud.

Telco edge computing is mainly defined as a distributed compute managed by a telco operator. This includes running workloads on customer premises as well as locations within the operator network. One of the reasons for caching and processing data closer to the customer data centres is that it allows both the operators and their customers to enjoy the benefit of reduced backhaul traffic and costs. Depending on where the computing resources reside, edge computing can be broadly divided into:

• Network edge which includes sites or points of presence (PoPs) owned by a telecoms operator such as base stations, central offices and other aggregation points on the access and/or core network.
• On-premise edge where the computing resources reside at the customer side, e.g. in a gateway on-site, an on-premises data centre, etc. As a result, customers retain their sensitive data on-premise and enjoy other flexibility and elasticity benefits brought by edge computing.

The edge computing opportunity for operators and hyperscalers

Many operators are looking at edge computing as a good opportunity to leverage their existing assets and resources to innovate and move up the value chain. They aim to expand their services and revenue beyond connectivity and enter the platform and application space. By deploying computing resources at the network edge, operators can offer infrastructure-as-a-service and alternative application and solutions for enterprises. Also, edge computing as a distributed compute structure and an extension of the cloud supports the operators’ own journey into virtualising the network and running internal operations more efficiently.

Cloud hyperscalers, especially the biggest three – Amazon Web Services (AWS), Microsoft Azure and Google – are at the forefront of the edge computing market. In the recent few years, they have made efforts to spread their influence outside of their public clouds and have moved the data acquisition point closer to physical devices. These include efforts in integrating their stack into IoT devices and network gateways as well as supporting private and hybrid cloud deployments. Recently, hyperscalers took another step to get closer to customers at the edge by launching platforms dedicated to telecom networks and enabling integration with 5G networks. The latest of these products include Wavelength from AWS, Azure Edge Zones from Microsoft and Anthos for Telecom from Google Cloud. 

From competition to coopetition

Both hyperscalers and telcos are among the top contenders to lead the edge market. However, each stakeholder lacks a significant piece of the stack which the other has. This is the cloud platform for operators and the physical locations for hyperscalers. Initially, operators and hyperscalers were seen as competitors racing to enter the market through different approaches. This has resulted in the emergence of new types of stakeholders including independent mini data centre providers such as Vapor IO and EdgeConnex, and platform start-ups such as MobiledgeX and Ori Industries.

However, operators acknowledge that even if they do own the edge clouds, these still need to be supported by hyperscaler clouds to create a distributed cloud. To fuel the edge market and build its momentum, operators will, in the most part, work with the cloud providers. Partnerships between operators and hyperscalers are starting to take place and shape the market, impacting edge computing short- and long-term strategies for operators as well as hyperscalers and other players in the market.

Major telco-hyperscalers edge partnerships

What does it mean for telcos?

Going to market alone is not an attractive option for either operators or hyperscalers at the moment, given the high investment requirement without a guaranteed return. The partnerships between two of the biggest forces in the market will provide the necessary push for the use cases to be developed and enterprise adoption to be accelerated. However, as markets grow and change, so do the stakeholders’ strategies and relationships between them.

Since the emergence of cloud computing and the development of the digital technologies market, operators have been faced with tough competition from the internet players, including hyperscalers who have managed to remain agile while building a sustained appetite for innovation and market disruption. Edge computing is not an exception and they are moving rapidly to define and own the biggest share of the edge market.

Telcos that fail to develop a strategic approach to the edge could risk losing their share of the growing market as non-telco first movers continue to develop the technology and dictate the market dynamics. This report looks into what telcos should consider regarding their edge strategies and what roles they can play in the market while partnering with hyperscalers in edge computing.

Indonesia Digital

Pada era digital seperti sekarang ini, masyarakat didorong untuk menyelesaikan kegiatan atau tugas sehari-hari secara digital/online. Pada tahun 90 an internet masih dianggap barang mewah, tetapi di tahun 2019 sudah sangat mudah bagi masyarakat untuk mendapatkan akses internet dengan kecepatan yang memadai. Saat ini, masyarakat di kota-kota besar sangat bergantung kepada ketersediaan internet karena sebagian besar dari aktivitas yang dilakukan membutuhkan internet. Hal ini terus didorong dengan berkembangnya produk dan layanan digital yang mempermudah kehidupan masyarakat baik secara usaha maupun kehidupan sehari-hari. 

Menurut Google dan Bain & Company pada e-Conomy SEA 2019 Report, ekonomi internet Indonesia pada tahun 2019 berada pada tingkat USD 40 miliar, dan ditargetkan mencapai USD 130 miliar pada tahun 2025 atau diperkirakan akan tumbuh lebih dari 3 kali lipat. Dengan tren penggunaan internet yang terus meningkat, prospek penyediaan produk dan layanan digital dapat terus berkembang untuk dapat memberikan kemudahan kepada masyarakat. 

Berdasarkan Kementrian Koperasi dan Usaha Kecil Menengah, jumlah pengusaha bisnis di Indonesia meningkat dari hanya 1,67% menjadi 3,10% dari total penduduk Indonesia, dimana seluruh bisnis tersebut membutuhkan public awareness untuk mendapatkan pelanggan baru dan juga meningkatkan penggunaan produk atau layanan yang ditawarkan pada bisnis. 

Periklanan menjadi salah satu cara utama bagi para bisnis mendapatkan public awareness, menurut Nielsen, penetrasi media internet dan OOH secara berturut-turut menempati peringkat kedua dan ketiga, menggantikan posisi koran dan radio. Selain itu, adanya kombinasi dengan digital advertising dimana iklan dapat menargetkan pelanggan dengan kriteria tertentu sehingga kegiatan marketing para pelaku bisnis dapat lebih efisien. Dengan demikian, ke depannya mayoritas perusahaan akan beralih memasarkan produknya melalui periklanan digital untuk membantu menerapkan strategi digital yang komprehensif untuk membantu mereka meningkatkan pertumbuhan pendapatan.

Di Indonesia, industri media dan hiburan kini didominasi oleh platform digital terutama platform video-streaming dan gaming. Berdasarkan Nielsen, platform streaming untuk mengakses konten video, portal TV online, internet TV berlangganan menjadi platform “favorit” bagi pengguna layanan internet. Seiring dengan perubahan perilaku masyarakat yang semakin meningkat dalam menggunakan internet, maka kebutuhan layanan komunikasi data dalam sisi jangkauan maupun kecepatan semakin meningkat. Penetrasi jaringan broadband yang masih rendah serta masuknya era teknologi 5G, mendorong pembangunan infrastruktur  teknologi komunikasi saat ini.

Digital Business Deal TikTok #5

Taken from nytimes.com 's article August 24, 2020

TikTok Sues U.S. Government Over Trump Ban

The suit escalates a bitter back-and-forth between the popular video app and American officials.

TikTok sued the U.S. government on Monday, accusing the Trump administration of depriving it of due process when President Trump used his emergency economic powers to issue an executive order that will block the app from operating in the country.

The suit is TikTok’s most direct challenge to the White House and escalates an increasingly bitter back-and-forth between the popular video app and American officials.

Mr. Trump has repeatedly said TikTok, which is owned by ByteDance, poses a national security threat because of its Chinese ties. On Aug. 6, he issued twin executive orders banning transactions with TikTok and the Chinese social media app WeChat within 45 days. A week later, he issued a separate executive order giving ByteDance 90 days to divest from its American assets and any data that TikTok had gathered in the United States.

Relations between the US and China have soured in recent months over rifts in geopolitics, technology and trade. The campaign has been partly provoked by China’s more assertive posture, but also Mr. Trump’s desire to convince voters that he is tough on China.

As part of that, Mr. Trump’s advisers have zeroed in on technology companies that they say are beholden to the Chinese government through security laws, including ByteDance, the Chinese telecom equipment maker Huawei and the internet company Tencent, the owner of WeChat.

Mr. Trump’s first executive order against TikTok draws its legal authority from the International Emergency Economic Powers Act, which allows the president to regulate economic transactions in a national emergency. Past administrations have used it to punish foreign governments, as well as drug kingpins and hackers, but have never used it against a global technology company.

A partner at the law firm Alston & Bird, said courts would probably be reluctant to challenge the president on national security grounds. But if a court does decide to rule against Mr. Trump, that could end up curtailing the powers of the presidency.

TikTok explaining the grounds for its lawsuit that the Trump administration “failed to follow due process and act in good faith, neither providing evidence that TikTok was an actual threat, nor justification for its punitive actions.” The company also claimed that the purported national security threat identified by the Committee on Foreign Investment in the United States was based on “outdated news articles” and did not address the documentation provided by TikTok demonstrating the security of user data.

One of the Trump administration’s chief concerns has been the storage of American user data on foreign servers. But in its complaint, TikTok said it had taken “extraordinary measures to protect the privacy and security of TikTok’s U.S. user data,” which included storing American users’ data outside China on servers in the United States and Singapore. The company said it had also erected “software barriers” that stored U.S. user data separately from the data kept on other products and companies owned by ByteDance.

The company also said many of its top personnel — including its chief executive, general counsel and global chief security officer — were all in the United States and were not subject to Chinese law. And further, content moderation across the TikTok app is led by a team based in the United States, operating independently from China.

The Justice Department declined to comment on the suit.

The president’s move to ban WeChat, a social media app used widely by people of Chinese descent in the United States, is also facing legal challenges. A nonprofit group calling itself the WeChat Users Alliance filed a separate suit in a federal court in San Francisco arguing that the president’s attempt to ban WeChat violated various constitutional protections, including the First Amendment, and seeking an injunction against the move.

The executive orders against TikTok have led ByteDance to explore a sale of the popular video app, which is used by millions of teenagers and influencers. The company is in talks with multiple American firms, including Microsoft and Oracle, for a sale of at least parts of its business. TikTok is continuing to negotiate a potential sale while it fights the U.S. government in court.

Such a deal would require the company to move American user accounts over to the acquirer’s servers, a stipulation required by the White House. Microsoft is largely seen as the front-runner in the negotiations.

Another Chinese tech company that the Trump administration has targeted as part of its clampdown is Huawei, the giant maker of smartphones and telecommunications equipment. Huawei has also tried to use the American legal system to push back, though not always successfully.

The company sued the U.S. government over a spending law that prohibited federal agencies and contractors from using Huawei equipment, and sued the Federal Communications Commission after the agency barred American mobile carriers from using government subsidies to buy the company’s gear. 

Digital Business Deal TikTok #4

Taken from DealBook's article August 24, 2020 TikTok is taking the U.S. to court

The Chinese-owned video app plans to sue the Trump administration as soon as today over its order to force a sale. It faces long odds, pressure from rivals and unrest within its ranks.

TikTok is still in talks with potential bidders, including Microsoft and Oracle. There were discussions with other would-be suitors, but some appear to have dropped out: Bloomberg reports that Alphabet, the parent of Google, quit talks to join a group bid for TikTok.

It is fending off Facebook on multiple fronts. The Silicon Valley giant has rolled out new products that clone many of TikTok’s main features. And last fall, Mark Zuckerberg reportedly told U.S. lawmakers behind closed doors that Chinese internet companies like TikTok were threatening their American counterparts, according to The Wall Street Journal. It is trying to reassure its American employees. In virtual town halls, employees are asking whether they’ll still be paid if the service is forced to shut down, according to Bloomberg. And internally, Sept. 15 — when one of the Trump executive orders is set to take effect — is reportedly referred to as “D-Day.” Deal Professor: What TikTok wants Steven Davidoff Solomon, a.k.a. the Deal Professor, is a professor at the U.C. Berkeley School of Law and the faculty co-director at the Berkeley Center for Law, Business and the Economy. Here, he considers the prospects for TikTok’s legal challenge against the White House. TikTok’s lawsuit is a delaying tactic, at best. President Trump has issued two executive orders targeting ByteDance, TikTok’s Beijing-based parent company. The first, issued on Aug. 6, cites powers under the International Emergency Economic Powers Act and the National Emergencies Act to bar any U.S. person from transacting with TikTok, starting 45 days after the announcement. The second, issued on Aug. 14, ordered ByteDance to sell TikTok to a U.S. owner within 45 days. It relies on the Exon-Florio Amendment of the Defense Production Act, which allows the president to order a foreign company to divest U.S. assets if their purchase is perceived to have hurt national security. (The transaction in question here is ByteDance’s acquisition of Musical.ly, TikTok’s predecessor, in 2017.) On the Exon-Florio order, there is one previous case to go on: President Barack Obama’s order requiring Ralls, a Chinese-owned firm, to sell a wind farm it had bought that was deemed too close to a U.S. military base. Ralls sued, and a federal court ruled that while a foreign company was entitled to due process rights, like being able to examine the unclassified information used in the order, the substance of the decision is not challengeable. Ultimately, Ralls still had to dispose of the wind farm, but with more leeway to choose the buyer. In the case of the Emergency Powers Act, ByteDance could make a similar argument about due process. Foreign states and organizations have challenged such orders over the years, and due-process rights have been held to apply. TikTok thus has precedents for a legal challenge — but it would merely delay the inevitable. It cannot challenge the substance of the divestiture order. And although Mr. Trump appears to stretch the legal boundaries of his emergency powers, courts are unlikely to interfere. Still, TikTok could extend time for a deal by persuading a court to delay the application of the orders. This is what the lawsuit is about: avoiding a fire sale. More time could help it fetch a higher price or better sales terms, but by this time next year TikTok will almost certainly be under new, American ownership.

Digital Business Deal TikTok #3

Taken from Reuters article August 20, 2020

Unusual for U.S. Treasury to get a cut of any TikTok sale: White House aide

WASHINGTON (Reuters) - President Donald Trump wants to deny China some of the proceeds from the sale of ByteDance’s U.S. operations of its video-sharing app TikTok, White House economic adviser Larry Kudlow said on Wednesday, but it would be unusual for any company that acquires TikTok to provide funds to the U.S. Treasury.

“Well he’s said that,” Kudlow told CNBC when asked about Trump’s demand that part of the proceeds from the TikTok sale he has ordered go to the U.S. Treasury.

“I acknowledge that it’s unusual. The president has his own mind on some of these things,” Kudlow said.

“I don’t know whether that will end up being the case when the Treasury gets its bids in from potential bidders. But the president has said that. I think he probably would like to deny China some of the proceeds of the TikTok sale,” Kudlow added.

Trump ordered ByteDance last week to divest TikTok’s U.S. operations within 90 days, the latest effort to ramp up pressure on the Chinese company over concerns about the safety of the personal data it handles.

Trump has said he would support an effort by Microsoft Corp to buy TikTok’s American operations if the U.S. government gets a “substantial portion” of the proceeds, but has also said there are other interested potential buyers.

Oracle Corp has joined some of the investors of TikTok’s Chinese owner ByteDance in pursuing a bid for the app’s operations in North America, Australia and New Zealand, according to people familiar with the matter.

Platform Deal Fortnite #2

Taken from DealBook Briefing August 18, 2020 

The Apple-Epic battle kicks up a notch

One of Silicon Valley’s most closely watched fights escalated yesterday, after Epic Games accused Apple of threatening to block it from important developer services — a move that could have repercussions beyond games like Fortnite, Epic’s marquee title.

Epic said that it could lose access to developer accounts and tools for iOS and Mac operating systems as a result of the company’s dispute with Apple over the 30 percent commission that software developers pay for sales made within iOS apps. Apple removed Fortnite, the hugely popular multiplayer game, from its app store after Epic urged players to pay it directly rather than via Apple. Losing Apple’s developer tools is a bigger deal than just blocking Fortnite on the App Store. Epic’s software platform, known as the Unreal Engine, underpins scores of other video games and apps (including software for training astronauts). Revoking its developer accounts would leave Epic unable to update that engine for iOS or Mac devices, meaning other developers’ games and apps that rely on it would eventually become unusable. • That could force developers to use other engines — not a small task — and could put a dent in Epic’s recently minted $17 billion valuation. Apple said in a statement that it was simply forcing Epic to comply with rules that apply to all developers on its platforms. Epic will be hoping to rally more companies to its cause. It has already tapped into growing frustration with Apple’s power over its App Store, which has become the subject of antitrust scrutiny in Washington and Brussels. And The Information reports that the game developer is trying to form a coalition of like-minded partners, including Spotify and Sonos.

Platform Deal Fortnite #1

Taken from DealBook Briefing August 14, 2020 

Fortnite picks a fight

Apple and Google have kicked Fortnite out of their app stores, making the wildly popular and hugely lucrative video game unavailable to many iPhone and Android device users. It follows moves by Epic Games, the maker of Fortnite, encouraging the game’s mobile-app users to pay it directly rather than going through the online stores, which take a cut of sales.

The tech giants insist on handling app payments and take a 30 percent commission on transactions via their stores. This gatekeeper policy is at the center of antitrust complaints against Apple and Google in the U.S. and Europe. After the Fortnite ban, Epic sued Apple and Google in federal court, with its C.E.O., Tim Sweeney, promising “a hell of a fight.”

• Epic’s argument: Apple and Google collectively dominate mobile platforms and cannot be trusted to charge “fair” prices. • Apple and Google’s argument: They built and maintain their platforms and should be allowed to charge whatever they want. In other words, they aren’t public utilities. It’s a gutsy gambit by Epic, and probably a losing one, at least in the short term. Neither Apple nor Google is likely to capitulate: If they did, they’d have to offer the same terms to everyone on their platforms. (“These guidelines create a level playing field for all developers and make the store safe for all users,” Apple said in a statement.) However, a protracted legal battle could put more pressure on the tech giants in Washington, Brussels and other places that are looking closely at their market power. If Epic rallies app developers to get behind its cause, that could be a problem for the platforms, too. • Since March 2018, Fortnite has been downloaded more than 130 million times on iPhones and iPads, generating about $360 million in revenue for Apple, according to Sensor Tower. It’s easier to download apps on Android devices outside Google’s store, so it has made less in commissions from sales of Fortnite, which has appeared in its online store only since April. Fortnite can also be played on other devices, computers and consoles, giving it leeway to lose iPhone and Android users without going completely dark. This is not a genuine negotiation. For Epic Games, it is as much a public relations event as anything else. Within minutes of Fortnite’s being banned by Apple — something that Epic clearly anticipated — it released a slickly produced video parody of Apple’s famous “1984” ad. Mr. Sweeney, the game maker’s chief, framed the dispute as no less than “critical to the future of humanity,” citing the risk of submission to “corporations who control all commerce and all speech.” • Spotify, which has waged a similar battle with Apple, issued a statement in support of Epic and against what it called Apple’s “unfair practices.” • It’s worth noting that Epic brought out its own app store in 2018. It charges developers a 12 percent commission, which it says is still comfortably profitable. Which is worse for Apple: No Fortnite or no WeChat? Losing the mostly young fans of Fortnite is bad, but the Trump administration’s threat to ban U.S. companies from doing business with China’s WeChat could affect vast numbers of iPhone users. Whatever the case, the longer these disputes endure, the bigger the risk that people who feel they can’t live without a certain game or messaging app will think twice about buying Apple devices.

Digital Business Deal TikTok #2

Taken from DealBook Briefing August 18, 2020 The race for TikTok gets (even more) interesting

As the Chinese-owned video app negotiates to sell itself to avoid being banned in the U.S., The Financial Times reports that a surprising new suitor has emerged: Oracle, the Silicon Valley giant better known for business software than for social networking.

Oracle has held preliminary talks with ByteDance, TikTok’s parent company, according to the FT. Its aim was to buy TikTok’s operations in the U.S., Canada, Australia and New Zealand, the same assets that Microsoft has publicly said it is negotiating to acquire. Like Microsoft and any other potential buyer, Oracle’s talks have included ByteDance investors such as Sequoia and General Atlantic.

• Oracle is only the latest company to express interest in buying TikTok after the Trump administration’s demand to transfer ownership of the app to an American company: Twitter had previously emerged as a suitor, and others are in the mix as well, DealBook’s Michael de la Merced hears. Oracle has an advantage: close ties to the White House. Both Larry Ellison, its co-founder, and Safra Catz, its C.E.O., are among the few prominent Trump supporters in Silicon Valley. It arguably has a better relationship with the Trump administration than even Microsoft, which has itself navigated the current Washington landscape more deftly than rivals like Alphabet and Facebook. • But Oracle also faces a question: What would it do with TikTok, given that it has little experience in the way of consumer-facing businesses? The White House is expanding its battle against the Chinese tech industry. The Commerce Department widened restrictions on Huawei, making it harder for the company to buy chips made or designed with American equipment and and software. The net effect of all these moves, The Times notes, is a potential splintering of the internet.

Digital Business Deal TikTok #1

Taken from DealBook Briefing August 17, 2020  TikTok isn’t standing still

As TikTok negotiates its potential sale, which must be completed within 90 days to prevent the Chinese-owned app from being shut down in the U.S., it is signing a different sort of deal.

TikTok is partnering with UnitedMasters, a music distribution company, to allow artists on the video-sharing platform to distribute their songs directly from the app to streaming services like Apple Music, Spotify and YouTube. UnitedMasters also arranges music deals with brands like ESPN and the N.B.A. The deal is expected to be announced today. It’s the first major transaction for Kevin Mayer, TikTok’s C.E.O., who joined the company in May after a long career at Disney. Much of his time has been spent reacting to geopolitics, with TikTok’s parent company, the Beijing-based ByteDance, ensnared in the tech cold war between the U.S. and China. Citing national security concerns, President Trump has ordered TikTok’s U.S. operations to be sold to an American owner — Microsoft is the most likely buyer — or shut down. • Despite the uncertainty of TikTok’s fate in the U.S., the UnitedMasters deal shows that the company is not standing still, even if the benefits of the new partnership will probably accrue to a new owner. It’s an effort to deepen relationships with influential artists who use the app. TikTok’s young and engaged audience has helped songs go viral, jump-starting the careers of musicians like Lil Nas X and BMW Kenny. Trying to keep these creators engaged with the app is particularly important as TikTok faces competition from deep-pocketed rivals like Facebook’s Instagram, which recently launched a TikTok clone called Reels. It’s a sign of the times for the music industry. Instead of selling their rights to a label, artists who sign with UnitedMasters keep 90 percent of their royalties, as well as ownership of the master recordings. UnitedMasters was founded in 2017 by the former label executive Steve Stoute and funded by the likes of Alphabet and Andreessen Horowitz. The deal, which creates a platform designed to circumvent the traditional music-label business model, is aimed at “tomorrow’s stars who will be famous, fiercely independent and wealthy,” said Mr. Stoute, a long-established tastemaker in the hip-hop industry. • In many ways, TikTok has already upended the music business: Scouts no longer go to bars and clubs to discover the hottest unsigned artists — they scroll through the app instead. By partnering with UnitedMasters, the app is aiming to bolster its appeal to independent-minded artists who operate outside the traditional industry machinery. But what about that other deal? TikTok would not comment on the state of the company’s takeover talks with Microsoft. The deal with UnitedMasters does not appear to be contingent upon that transaction, and is billed as a “global” partnership. However, if TikTok were to shut down in the U.S., it would clearly affect the reach of the music deal. Terms of the transaction were not disclosed.