A decade ago, it was almost inconceivable that nearly every household item could be hooked up to the internet. These days, it’s near impossible to avoid a non-smart home gadget, and they’re vacuuming up a ton of new data that we’d never normally think about.
Thermostats know the temperature of your house, and smart cameras and sensors know when someone’s walking around your home. Smart assistants know what you’re asking for, and smart doorbells know who’s coming and going. And thanks to the cloud, that data is available to you from anywhere — you can check in on your pets from your phone or make sure your robot vacuum cleaned the house.
Because the data is stored or accessible by the smart home tech makers, law enforcement and government agencies have increasingly sought data from the companies to solve crimes.
And device makers won’t say if your smart home gadgets have been used to spy on you.
For years, tech companies have published transparency reports — a semi-regular disclosure of the number of demands or requests a company gets from the government for user data. Google was first in 2010. Other tech companies followed in the wake of Edward Snowden’s revelations that the government had enlisted tech companies’ aid in spying on their users. Even telcos, implicated in wiretapping and turning over Americans’ phone records, began to publish their figures to try to rebuild their reputations.
As the smart home revolution began to thrive, police saw new opportunities to obtain data where they hadn’t before. Police sought Echo data from Amazon to help solve a murder. Fitbit data was used to charge a 90-year old man with the murder of his stepdaughter. And recently, Nest was compelled to turn over surveillance footage that led to gang members pleading guilty to identity theft.
Yet, Nest — a division of Google — is the only major smart home device maker that has published how many data demands it receives.
As first noted by Forbes last week, Nest’s little-known transparency report doesn’t reveal much — only that it’s turned over user data about 300 times since mid-2015 on over 500 Nest users. Nest also said it hasn’t to date received a secret order for user data on national security grounds, such as in cases of investigating terrorism or espionage. Nest’s transparency report is woefully vague compared to some of the more detailed reports by Apple, Google and Microsoft, which break out their data requests by lawful request, by region and often by the kind of data the government demands.
As Forbes said, “a smart home is a surveilled home.” But at what scale?
We asked some of the most well-known smart home makers on the market if they plan to release a transparency report, or disclose the number of demands they receive for data from their smart home devices.
For the most part, we received fairly dismal responses.
What the big four tech giants said
Amazon did not respond to requests for comment when asked if it will break out the number of demands it receives for Echo data, but a spokesperson told me last year that while its reports include Echo data, it would not break out those figures.
Facebook said that its transparency report section will include “any requests related to Portal,” its new hardware screen with a camera and a microphone. Although the device is new, a spokesperson did not comment on if the company will break out the hardware figures separately.
Google pointed us to Nest’s transparency report but did not comment on its own efforts in the hardware space — notably its Google Home products.
And Apple said that there’s no need to break out its smart home figures — such as its HomePod — because there would be nothing to report. The company said user requests made to HomePod are given a random identifier that cannot be tied to a person.
What the smaller but notable smart home players said
August, a smart lock maker, said it “does not currently have a transparency report and we have never received any National Security Letters or orders for user content or non-content information under the Foreign Intelligence Surveillance Act (FISA),” but did not comment on the number of subpoenas, warrants and court orders it receives. “August does comply with all laws and when faced with a court order or warrant, we always analyze the request before responding,” a spokesperson said.
Roomba maker iRobot said it “has not received any demands from governments for customer data,” but wouldn’t say if it planned to issue a transparency report in the future.
Both Arlo, the former Netgear smart home division, and Signify, formerly Philips Lighting, said they do not have transparency reports. Arlo didn’t comment on its future plans, and Signify said it has no plans to publish one.
Ring, a smart doorbell and security device maker, did not answer our questions on why it doesn’t have a transparency report, but said it “will not release user information without a valid and binding legal demand properly served on us” and that Ring “objects to overbroad or otherwise inappropriate demands as a matter of course.” When pressed, a spokesperson said it plans to release a transparency report in the future, but did not say when.
Spokespeople for Honeywell and Canary — both of which have smart home security products — did not comment by our deadline.
And, Samsung, a maker of smart sensors, trackers and internet-connected televisions and other appliances, did not respond to a request for comment.
Only Ecobee, a maker of smart switches and sensors, said it plans to publish its first transparency report “at the end of 2018.” A spokesperson confirmed that, “prior to 2018, Ecobee had not been requested nor required to disclose any data to government entities.”
All in all, that paints a fairly dire picture for anyone thinking that when the gadgets in your home aren’t working for you, they could be helping the government.
As helpful and useful as smart home gadgets can be, few fully understand the breadth of data that the devices collect — even when we’re not using them. Your smart TV may not have a camera to spy on you, but it knows what you’ve watched and when — which police used to secure a conviction of a sex offender. Even data from when a murder suspect pushed the button on his home alarm key fob was enough to help convict someone of murder.
Two years ago, former U.S. director of national intelligence James Clapper said the government was looking at smart home devices as a new foothold for intelligence agencies to conduct surveillance. And it’s only going to become more common as the number of internet-connected devices spread. Gartner said more than 20 billion devices will be connected to the internet by 2020.
As much as the chances are that the government is spying on you through your internet-connected camera in your living room or your thermostat are slim — it’s naive to think that it can’t.
But the smart home makers wouldn’t want you to know that. At least, most of them.
For the first time, Uber will make contextual, personalized suggestions about the best way to get from point A to point B. The startup offers more than just cars now, and it’s starting to understand the trade-offs between price, speed, convenience and comfort amidst its multi-modal fleet. Most noticeably, you’ll soon see JUMP bikes get premier billing right alongside Uber’s other vehicles. Going a short distance and there’s a charged up bike nearby? Uber will suggest you pedal. Might need extra room for luggage on your way to the airport? UberXL and SUV will appear. Always take cheap Pools? It won’t show you a pricier Black car.
Uber is finally getting smart. It has to if it’s going to make sense of its growing patchwork of ride types without overwhelming passengers with too many options. Uber’s algorithm can help them choose. “We think there’s a lot to be gained by being a one-stop shop to get somewhere,” says Uber director of product Nundu Janakiram.
In particular, Uber could block disruption by scooter-specific startups like Spin, Bird or Skip. If those apps have no vehicles nearby or you’re going too far, they’ve got nothing to offer. But Uber can provide a competitively priced Express Pool when there’s no open-air ride available, while convincing its existing UberX riders to try a bike or scooter for quick trips when congestion is thick, thanks to its new in-house traffic estimates.
Previously, you’d get a static set of three ride options from the price class you booked from last, regardless of your destination. Meanwhile, bikes and scooters were buried in Uber’s hamburger menu sidebar or an awkward toggle at the top of the screen. The company hasn’t done a good job of communicating the definition of Select (nicer normal-sized cars) or Express Pool (walk and wait for a discount) either.
Now Uber’s homescreen can cherry pick the most relevant ride suggestions from across all price classes and vehicle types based on your trip length, destination type and personal ride history. Along with better explanations of the different options, this could get users experimenting with modes they’d never tried before. In the coming weeks, you’ll start to see bikes in these recommendations.
To make room for more suggestions, the Uber Pool option will unfold to offer both Pools and Express Pools. Uber will even point you to nicer vehicles like Black cars or XLs if UberX is surging to the point that their prices are similar. If you want to compare all the options manually, you can tap to see a list with all the specs and prices lined up.
Beyond ride recommendations, Uber is moving the address bar to the bottom of the screen so it’s closer to your thumbs (which is great as phones keep getting bigger). Finally, in the coming weeks Uber will add a dynamic message bar to the center of the homescreen. Here, depending on your pickup and drop off, it could show instructions for hailing from an airport, a discount offer, a birthday message or just a friendly “Good Morning.”
Eventually, Uber hopes to integrate public transportation ticketing like through its partner Masabi, car rentals and even multi-leg trips into its recommendations. Maybe a JUMP bike to the train, then an UberPool that’s waiting to take you to your final destination is quicker and cheaper than any one mode alone. If you’re looking at an hour-plus Uber, it might cost less to just rent a car through its partner GetAround and drive yourself. And if a scooter is by far the best ride for you but all of Uber’s are rented, it could recommend one from its partner Lime.
Uber’s data shows users are rapidly embracing the multi-modal future. A study found the introduction of JUMP bikes to one city led to a 15 percent increase in total Uber + JUMP trips, even though Uber use dropped 10 to 15 percent.
Even if Uber sometimes cannibalizes itself by recommending cheaper options, it’s a smart long-term strategy. Janakiram laughs that “If we wanted to optimize for revenue, we wouldn’t have shown UberX, Pool and Express Pool first for every user for the last few years.” The lifetime value of ridesharing users is so high that it’s worth losing a couple of bucks here or there to keep users from straying to multi-modal competitors like Lyft. Retention will be a key metric under scrutiny as it eyes a 2019 IPO at a potential $ 120 billion valuation.
“The big picture is that we want your phone to replace your personal car,” Janakiram concludes. “If we want to be a true transportation platform, we need to be everywhere our riders need to be, as well. The right ride for the right context, and what’s the right ride for you.”
[Disclosure: Uber’s Janakiram and I briefly lived in the same three-bedroom apartment five years ago, though I’d already agreed to write about the redesign when I found out he was involved.]
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Truphone — a UK startup that provides global mobile voice and data services by way of an eSIM model for phones, tablets and IoT devices — said that it has raised another £18 million ($ 23.7 million) in funding; plus it said it has secured £36 million ($ 47 million) more “on a conditional basis” to expand its business after signing “a number of high-value deals.”
It doesn’t specify which deals these are, but Truphone was an early partner of Apple’s to provide eSIM-based connectivity to the iPad — that is, a way to access a mobile carrier without having to swap in a physical SIM card, which has up to now been the standard for GMSA-based networks. Truphone is expanding on this by offering a service for new iPhone XS and XR models, taking advantage of the dual SIM capability in these devicews. Truphone says that strategic partners of the company include Apple (“which chose Truphone as the only carrier to offer global data, voice and text plans on the iPad and iPhone digital eSIM”); Synopsys, which has integrated Truphone’s eSIM technology into its chipset designs; and Workz Group, a SIM manufacturer, which has a license from Truphone for its GSMA-accredited remote SIM provisioning platform and SIM operating system.
The company said that this funding, which was made by way of a rights issue, values Truphone at £386 million ($ 507 million at today’s rates) post-money. Truphone told TechCrunch that the funding came from Vollin Holdings and Minden Worldwide — two investment firms with ties to Roman Abramovich, the Russian oligarch who also owns the Chelsea football club, among other things — along with unspecified minority shareholders. Collectively, Abramovich-connected entities control more than 80 percent of the company.
We have asked the company for more detail on what the conditions are for the additional £36 million in funding to be released and all it is willing to say is that “it’s KPI-driven and related to the speed of growth in the business.” It’s unclear what the state of the business is at the moment because Truphone has not updated its accounts at Companies House (they are overdue). We have asked about that, too.
For some context, Truphone most recently raised money almost exactly a year ago, when it picked up £255 million also by way of a rights issue, and also from the same two big investors. The large amount that time was partly being raised to retire debt. That deal was done at a valuation of £370 million ($ 491 million at the time of the deal). Going just on sterling values, this is a slight down-round.
Truphone, however, says that business is strong right now:
“The appetite for our technology has been enormous and we are thrilled that our investors have given us the opportunity to accelerate and scale these groundbreaking products to market,” said Ralph Steffens, CEO, Truphone, in a statement. “We recognised early on that the more integrated the supply chain, the smoother the customer experience. That recognition paid off—not just for our customers, but for our business. Because we have this capability, we can move at a speed and proficiency that has never before seen in our industry. This investment is particularly important because it is testament not just to our investors’ confidence in our ambitions, but pride in our accomplishments and enthusiasm to see more of what we can do.”
Truphone is one of a handful of providers that is working with Apple to provide plans for the digital eSIM by way of the MyTruphone app. Essentially this will give users an option for international data plans while travelling — Truphone’s network covers 80 countries — without having to swap out the SIMs for their home networks.
The eSIM technology is bigger than the iPhone itself, of course: some believe it could be the future of how we connect on mobile networks. On phones and tablets, it does away with users ordering, and inserting or swapping small, fiddly chips into their devices (that ironically is also one reason that carriers have been resistant to eSIMs traditionally: it makes it much easier for their customers to churn away). And in IoT networks where you might have thousands of connected, unmanned devices, this becomes one way of scaling those networks.
“eSIM technology is the next big thing in telecommunications and the impact will be felt by everyone involved, from consumers to chipset manufacturers and all those in-between,” said Steve Alder, chief business development officer at Truphone. “We’re one of only a handful of network operators that work with the iPhone digital eSIM. Choosing Truphone means that your new iPhone works across the world—just as it was intended.” Of note, Alder was the person who brokered the first iPhone carrier deal in the UK, when he was with O2.
However, one thing to consider when sizing up the eSIM market is that rollout has been slow so far: there are around 10 countries where there are carriers that support eSIM for handsets. Combining that with machine-to-machine deployments, the market is projected to be worth $ 254 million this year. However, forecasts put that the market size at $ 978 million by 2023, possibly pushed along by hardware companies like Apple making it an increasingly central part of the proposition, initially as a complement to a “home carrier.”
Truphone has not released numbers detailing how many devices are using its eSIM services at the moment — either among enterprises or consumers — but it has said that customers include more than 3,500 multinational enterprises in 196 countries. We have asked for more detail and will update this post as we learn more.
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Backed with nearly $ 87 million in venture capital funding from GV, Oak HC/FT and F-Prime Capital, Quartet Health was founded in 2014 by Arun Gupta, Steve Shulman and David Wennberg to improve access to behavioral healthcare. Its mission: “enable every person in our society to thrive by building a collaborative behavioral and physical health ecosystem.”
Recent shakeups within the New York-based company’s c-suite and a perusal of its Glassdoor profile suggest Quartet’s culture is not fully in line with its own philosophy.
In the last few weeks, chief product officer Rajesh Midha has left the company and president and chief operating officer David Liu is on his way out, TechCrunch has learned and confirmed with Quartet. Founding chief executive officer Arun Gupta, meanwhile, has stepped into the executive chairman role, relinquishing responsibility of the company’s day-to-day operations to former chief science officer David Wennberg, who’s taken over as CEO.
“I’m focusing on our external growth,” Gupta told TechCrunch on Friday. “David has really stepped up as CEO.”
Gupta and Wennberg said Liu’s role was no longer needed because Wennberg had assumed his responsibilities. Liu will formally exit the company at the end of the month. As for its product chief, the pair say Midha had “transitioned out” of the role and that an unnamed internal candidate was tapped to replace him.
When asked whether other employees had left in recent weeks, Wennberg provided the following indeterminate statement: “We are always having people coming in. I don’t think we’ve had any unusual turnover. We’re hiring and people’s roles change and that’s just part of growth.”
Quartet, which provides a platform that allows providers to collaborate on treatment plans, currently has 150 employees, according to its executives.
In a LinkedIn status update published this week — after TechCrunch’s initial inquiries — Gupta announced his transition to executive chairman:
“Still full-time, though focused largely on our opportunity to further evangelize our mission, [I will] drive the change we want to see in this world, and expand our reach … I have tremendous confidence in David’s ability to lead our many talented Quartetians to deliver this next phase.”
Several former employees seemed less than pleased with Gupta’s performance, writing in a number of Glassdoor reviews that he was “abominable,” “kind of a monster” and “by far the worst executive.”
When asked for comment on those reviews, Gupta and Wennberg shrugged it off: “Glassdoor is Glassdoor.” They agreed its important to pay attention to but impossible to vet.
Gupta began his career as a management consultant at McKinsey and served as a consultant to The World Bank before joining Palantir, Peter Thiel’s data-mining company, as an advisor in 2014. Wennberg, for his part, was the CEO of The High Value Healthcare Collaborative, a consortium of 15 healthcare delivery systems, before co-founding Quartet.
In January, Quartet raised a $ 40 million Series C to expand throughout the U.S. F-Prime Capital and Polaris Partners led the round, with participation from GV and Oak HC/FT. The financing valued the company at $ 300 million, according to PitchBook.
As part of the funding, Quartet announced it was adding three new directors to its board: F-Prime’s executive partner Carl Byers; Ken Goulet, an executive vice president at health insurance provider Anthem; and former Rackspace CEO and BuildGroup co-founder Lanham Napier. Other outside board members include Oak HC/FT’s managing partner Annie Lamont, GV partner Krishna Yeshwant, Polaris managing partner Brian Chee and former U.S. Congressman Patrick Kennedy.
Quartet previously raised a $ 40 million Series B in April 2016 led by GV. The investment marked the venture capital investment arm of Google’s first in a mental health startup. Before that, the startup brought in a $ 7 million Series A led by Oak HC/FT’s managing partner Annie Lamont.
For now, Quartet remains committed to growth.
“We learn from what we are doing and we continue to learn,” Wennberg said. “That is part of growth. It’s hard and you just keep working and growing because we have a huge mission.”
Adults, not teens. Messaging, not Stories. Developing markets, not the US. These are how Snapchat will make a comeback, according to CEO Evan Spiegel . In a 6,000-word internal memo from late September leaked to Cheddar’s Alex Heath, Spiegel attempts to revive employee morale with philosophy, tactics, and contrition as Snap’s share price sinks to an all-time low of around $ 8 — half its IPO price and a third of its peak.
“The biggest mistake we made with our redesign was compromising our core product value of being the fastest way to communicate” Spiegel stresses throughout the memo regarding ‘Project Cheetah’. It’s the chat that made Snapchat special, and burying it within a combined feed with Stories and failing to build a quick-loading Android app have had disastrous consequences.
Spiegel shows great maturity here, admitting to impatient strategic moves and outlining a cohesive path forward. There’s no talk of Snapchat ruling the social app world here. He seems to understand that’s likely out of reach in the face of Instagram’s competitive onslaught. Instead, Snapchat is satisfied if it can help us express ourselves while finally reaching even meager profitability.
Snapchat may be too perceived as a toy to win enough adults, too late to win back international markets from the Facebook empire, and too copyable by good-enough alternatives to grow truly massive. But if Snap can follow the Spiegel game-plan, it could carve out a sustainable market through a small but loyal audience who want to communicate through imagery.
Here are the most interesting takeaways from the memo and why they’re important:
1. Apologizing For Rushing The Redesign
“There were, of course, some downsides to moving as quickly as a cheetah We rushed our redesign, solving one problem but creating many others . . . Unfortunately, we didn’t give ourselves enough time to continue iterating and testing the redesign with a smaller percentage of our community. As a result, we had to continue our iterations after we launched, causing a lot of frustration for our community.”
Spiegel always went on his gut rather than relying on user data like Facebook. Aging further and further away from his core audience, he misread what teens cared about. The appealing buzz phrase of “separating social from media” also meant merging messaging and Stories into a chaotic list that made both tougher to use. Spiegel seems to have learned a valuable lessen about the importance of A/B testing.
2. Chat Is King
“Our redesigned algorithmic Friend Feed made it harder to find the right people to talk to, and moving too quickly meant that we didn’t have time to optimize the Friend Feed for fast performance. We slowed down our product and eroded our core product value. . . . Regrettably, we didn’t understand at the time that the biggest problem with our redesign wasn’t the frustration from influencers – it was the frustration from members of our community who felt like it was harder to communicate . . . In our excitement to innovate and bring many new products into the world, we have lost the core of what made Snapchat the fastest way to communicate.”
When Snap first revealed the changes, we predicted that “Teen Snap addicts might complain that the redesign is confusing, jumbling all content from friends together.” That made it too annoying to dig out your friends to send them messages, and Snap’s growth rate imploded, with it losing 3 million users last quarter. Expect Snap to optimize its engineering to make messages quicker to send and receive, and it even sacrifice some of its bells and whistles to make chat faster in developing markets.
3. Snapchat Must Beat Facebook At Best Friends
“Your top friend in a given week contributes 25% of Snap send volume. By the time you get to 18 friends, each incremental friend contributes less than 1% of total Snap send volume each. Finding best friends is a different problem than finding more friends, so we need to think about new ways to help people find the friends they care most about.”
Facebook’s biggest structural disadvantage is its broad friend graph that’s bloated to include family, co-workers, bosses, and distant acquaintances. That might be fine in a feed app, but not for Stories and messaging where you only care about your closest friends. With friend lists and more, Facebook has tried and failed for a decade to find better ways to communicate with your besties. This is the wedge through which Snapchat can attack Facebook. If it develops special features for luring your best friends onto the app and staying in touch with them for better reasons than just maintaining a Snap “Streak”, it could hit Facebook where it can’t defend itself.
4. Discover Soars As Facebook Watch And IGTV Stumble
“Our Shows continue to attract more and more viewers, with over 18 Shows reaching monthly audiences of over 10M unique viewers. 12 of which are Original productions. As a platform overall, we’ve grown the amount of total time spent engaging with our Shows product, almost tripling since the beginning of the year. Our audience for Publisher Stories has increased over 20% YoY, and we believe there is a significant opportunity to continue growing the number of people who engage with Discover content . . .We are also working to identify content that is performing well outside of Snapchat so that we can bring it into Discover. “
Discover remains Snapchat’s biggest differentiator, scoring with premium video content purposefully made for mobile. What it really needs, though, are a few must-see tentpole shows to drag in a wider audience that can get hooked on the reimagined digital magazine experience.
5. But Discover Is A Mess
“Our content team is working hard to experiment with new layouts and content types in the wake of our redesign to drive increased engagement.”
Snapchat Discover is an overcrowded pile of clickbait. News outlets, social media influencers, original video Shows, and aggregated user content collections all battle for attention in a design that feels overwhelming to the point of exhaustion. Thankfully Snapchat seems to recognize that more cohesive sorting with fewer images and headlines bombarding you might make Discover a more pleasant lean-back consumption experience.
6. Aging Up To Earn Money
“Most of the incremental growth in our core markets like the US, UK, and France will have to come from older users who generate higher average revenue per user . . . Growing in older demographics will require us to mature our application . . . Many older users today see Snapchat as frivolous or a waste of time because they think Snapchat is social media rather than a faster way to communicate. Changing the design language of our product and improving our marketing and communications around Snapchat will help users understand our value . . . aging-up our community in core markets will also help the media, advertisers, and Wall Street understand Snapchat.”
Snapchat can’t just be for cool kids anymore. Their lower buying power and lifestage make them less appealing to brands. The problem is that Snapchat risks turning off younger users by courting their older siblings or adults. If, like Facebook, users start to feel like Snapchat is a place for parents, they may defect in search of the next purposefully built to confuse adults to stay hip.
7. Finally Prioritizing Developing Markets
“We already have many projects underway to unlock our core product value in new markets. Mushroom allows our community to use Snapchat on lower-end devices. Arroyo, our new gateway architecture, will speed up messaging and many other services . . . It might require us to change our products for different markets where some of our value-add features detract from our core product value”
Sources tell me Snapchat’s future depends on the engineering overhaul of its Android app, a project codenamed ‘Mushroom’. Slow video load times and bugs have made Snapchat practically unusable on low-bandwidth connections and old Android phones in the developing world. The company concentrated on the US and other first-world markets, leaving the door open for copycats of Stories built by Instagram (400 million daily users) and WhatsApp (450 million daily users) to invade the developing world and dwarf Snap’s 188 million total daily users. In hopes of a smooth rollout, Snapchat is already testing Mushroom, but it will have to do a ton of marketing outreach to convince frustrated users who ditched the app to give it another try.
8. Fresh Ideas, Separate Apps
“We’re currently building software that takes the millions of Snaps submitted to Our Story and reconstructs parts of the world in 3D. We can then build augmented reality experiences on top of those models and distribute them as Lenses . . . If our innovation compromises our core product of being the fastest way to communicate, we should consider create [sic] separate applications or other ways of delivering our innovation.”
Snapchat has big plans for augmented reality. It doesn’t just want to stick animations over the top of anywhere, or create AR art installations in a few big cities. It wants to build site-specific AR experiences across the globe. And while everything the company has built to date has lived inside of Snapchat, it’s willing to spawn standalone apps if necessary so that it doesn’t bog down its messaging service. That could give Snapchat a lot more leeway to experiment.
9. The Freedom Of Profitability
“Our 2019 stretch output goal will be an acceleration in revenue growth and full year free cash flow and profitability. With profitability comes increased autonomy and freedom to operate our business in the long term best interest of our community without the pressure of needing to raise additional capital.”
Snapchat is still bleeding money, losing $ 353 million last quarter. Snapchat ended up selling 2.3 percent of its equity to a Saudi Arabian prince in exchange for $ 250 million to lengthen its rapidly shortening runway. And last year it took $ 2 billion from Chinese gaming giant Tencent. Deals like that could threaten Snapchat’s ability to prioritize its goals alone, not the moral imperatives or developer platforms that would benefit its benefactors. Once profitable, Snapchat won’t have to worry so much about struggling with short-term user growth and can instead focus on retention, societal impact, and its true purpose — creativity.
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