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Q&A Site ChaCha Cancels UK Expansion After Poor User Take-Up

ChaCha Picture

Can a reasonably successful, U.S.-based mobile content brand find equal success for its English-language service in the UK? It’s a question that could have been asked on the Q&A service ChaCha, and unfortunately it looks like the company has figured out the answer the hard way.

ChaCha, which launched in the UK in September 2011, has now quietly shut down operations in the country after failing to find enough people to use the service to make it cost-effective.

The company alerted its Guides — the people who get paid to answer questions from users — of the change on April 19, and noted that it would be shutting up the service on the next day. Sure enough, the URL for the UK site is not longer active.

ChaCha, which has been around since 2005, is primarily based around users sending questions in the form of text messages to a shortcode and receiving a text message in reply. It is one of the bigger — perhaps the biggest — Q&A sites of its kind, in March reporting 2 billion questions asked and answered, with 40 million unique users of the service.

It also has an impressive funding track record. To date, it has received $75 million in backing from investors including Amazon’s Jeff Bezos, Qualcomm and Rho Capital Partners, among others.

But this could be one case of when it’s not always best to be an early mover — or at least a lesson to early movers that they need to make sure they can change with the times, and in this case the rise of very capable smartphones.

Q&A has moved on a lot, with apps like Apple’s Siri, Evi, Iris, Vlingo and others offering a similar ability to answer questions but with many more features like voice response, integration with maps and more.

Ironically, one other chapter in ChaCha’s history involved the company launching a legal attack against HTC when the handset tried to launch an Android smartphone, branded ChaCha, in the U.S. (Its name eventually got changed to Status.)

ChaCha, of course, has the added benefit of working on any device — not just a smartphone — but it looks like its basic business model was focused on scale that it just wasn’t getting on that product: the idea in the UK was to disrupt the Q&A space by offering users the service at the same price as a regular text message. Other services make money by using the premium SMS channel (those texts can cost up to £1.50 here). So: accepting a much thinner margin on those texts, in exchange for a higher volume of usage and potentially the promise of selling sponsorship or advertising against that.

“Our mission was simply to provide quality answers at 1/15 the cost of the current competition. After months of direct advertising, branding events, marketing advice from UK leaders, and initiatives designed to help spread the word socially, we’ve found that adoption rates for new price-competitive services are quite low in the UK,” VP of operations Doug Gilmore writes in the letter.

Although the letter promises that ChaCha would pay Guides any outstanding balances owed by April 20, there seem to be users that are still complaining on the MoneySavingExpert forum, on a thread about the closure, that they that they have yet to be paid.

We’ve reached out to ChaCha to try to get some more details, and will update the story with whatever interesting facts that we learn. In the meantime, the letter below.

Dear UK Guides,

It is with a heavy heart that I announce ChaCha will no longer be offering our service in the UK and plan to stop incoming and outgoing texts on Friday, April 20th, 2012. This pains us because of all the hard work and dedication you have all contributed to the ChaCha service in the UK.

ChaCha began its UK service 9 months ago as an alternative to similar text-based services which charge premium rates for Q&A. Our mission was simply to provide quality answers at 1/15 the cost of the current competition. After months of direct advertising, branding events, marketing advice from UK leaders, and initiatives designed to help spread the word socially, we’ve found that adoption rates for new price-competitive services are quite low in the UK.

Any and all success we have had in the UK can be attributed to you, our Guides, who provided quality answers and helped us spread the word about the service. We would like to thank you for your service and support during the last 9 months.

Please note that we will process any and all remaining Guide funds from your ChaCha accounts and transfer those on Friday, April 20th.

With Warmest Regards-

Doug Gilmore – VP of Operations ChaCha Search Inc.


Q&A Site ChaCha Cancels UK Expansion After Poor User Take-Up

Research: Only 6% of UK Consumers Care About TV Apps; 12% Want Mobile TV; 19% Want 3D

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Attention TV world: consumers, it appears, are not as tech-friendly as you might think. According to a new survey out in the UK, the vast majority of the public is not interested in fancy new 3D or mobile TV services, and even less of them care about TV apps. What they would like are better players to watch on-demand content on their main TVs and better TV guides for discovering what is on where.

These conclusions come from Freeview, the UK’s subscription-free digital TV service, which canvassed opinion from some 2,000 UK consumers for its survey. Only 12 percent of consumers said they consider mobile TV an appealing service, and only 19 percent thought the same of 3D TV. And TV apps — something that has become standard among producers and broadcasters — fared worst of all, with only six percent saying these apps were appealing, and only eight percent thinking they were in any way “useful.”

But the company also notes that this year could potentially be a watershed for these newer technologies: with the Olympics coming to London this summer, this will be the first year that the games will be broadcast in HD to a mass market in the UK, and Freeview believes that this, plus general interest in the event (especially since most of us UK residents haven’t even been able to get a sniff of a ticket to the actual event… grrr) may drive uptake in some of the newer ways of consuming that content.

Freeview found that “players” — either in the form of set-top boxes or something more integrated in a smart TV — were considered to be the most appealing and useful of the wave of new services that have arisen out of the connected TV revolution. This rated at 62 percent and 63 percent among consumers.

Freeview notes that the results proved to be largely the same, whether the respondent considered himself a technophile or a technophobe, and regardless of that person’s age. And as you can see from the table below, the results didn’t change all that much (but did get slightly better for new technologies) when owners of smartphones and tablets were asked the same questions.

These conclusions paint a picture of a mass market not as interested in new technology as some might think — in the UK at least — and are a sign that companies that are investing money into developing services like TV apps, mobile TV and 3D technology might not be seeing a lot of return on that investment in the near future.

It also is a likely indicator of where Freeview — a disruptive presence in the UK market in that it offers a range of digital TV channels free of charge, against paid offerings from the likes of Sky and Virgin Media — may choose to invest (and disrupt) in the future.

That disruption is already coming home to roost: Freeview notes that as of last quarter, it has overtaken Sky TV, its largest competitor and a Pay-TV provider, in terms of number of active users in the UK. Freeview is now being used on the main TV sets of 10.8 million homes, compared to Sky’s 10.1 million active base.


Research: Only 6% of UK Consumers Care About TV Apps; 12% Want Mobile TV; 19% Want 3D

Mobile Messaging Consolidates: Myriad Group Buys Synchronica For $38M

text messaging

Some consolidation afoot in the evolving world of mobile messaging: one messaging provider, Switzerland’s Myriad Group, is buying a UK-based rival, Synchronica, for £23.9 million (around $38 million), in what looks like an all-share deal.

Myriad says the deal will make it one of the biggest providers of messaging services in the world. Together they provide messaging services to a huge range of tier-one carriers including ATT, Verizon, Vodafone, Telefónica, Orange, T-Mobile, América Móvil, NTT Docomo, MTS, Softbank, Megafon, Telcel, TIM, Airtel and Claro — altogether covering some 2.5 billion subscribers and 100 carriers and 25 OEMs worldwide.

The two companies have been in negotiations since last November, and in February 2012, Myriad argued to Synchronica shareholders that they needed to sell in part because Synchronica could not meet its repayment obligations to Nokia. Synchronica last year picked up Nokia’s messaging business for $25 million as the struggling handset maker was offloading less profitable assets.

The news comes at the same time as another development in the world of mobile messaging: Openwave has announced it is selling its messaging and mediation business to Marlin Equity Partners for an undisclosed amount and will now focus its business, renamed Unwired Planet, on its intellectual property (200 patents plus an additional 75 applications). It will continue to remain publicly traded.

By coincidence, Openwave once sold a trove of patents to Purple Labs, the mobile Linux specialist, which is now a part of Myriad.

Today’s offer for Synchronica is increased from Myriad’s original terms, and comes at 15 pence per share, compared to an original offer of 12 pence per share.

As part of the deal, Myriad CEO Simon Wilkinson becomes Synchronica executive chairman. Myriad’s CFO James Bodha is now an executive director at Synchronica. David Mason and Michael Jackson, who had respectively held those roles at Synchronica, have resigned with immediate effect.

Messaging services are in a state of evolution at the moment. On the one hand, traditional SMS revenues have been in decline for a while now, as increasing competition carriers has been met with added pressure from other services like BBM on BlackBerry devices, or iMessage on the iPhone, and WhatsApp. Ovum estimates that carriers’ SMS revenues were down by $14 billion in 2011, and that will rise to $23 billion this year.

On the other hand, companies like Myriad (and there are others, too) are working on some very interesting messaging products that are bridging the next generation of mobile services based around smartphones/social media with the fact that there are still a vast amount of people who are still using basic devices, and are living in places without the network connectivity to take advantage of smarter handsets anyway.

Myriad provides, for example, a way of accessing Facebook and other social media services using USSD technology, something built into even the most basic of GSM devices. It doesn’t require data network to be used, but does need the carrier to “turn on” the capability to use it. Myriad in February announced a deal with Orange to offer the service to access Facebook in Africa. It has already picked up at least 400,000 users of the service as it rolls it out across its footprint.

(Orange told me there were already 350,000 signed up in Egypt when the service formally launched, and a Myriad spokesperson tells me that since it went live another 50,000 have signed up.) Last week, Myriad announced that it is extending the service across Asia — which, taken as a whole, only has smartphone penetration of 20 percent — and already is working with Vodafone India to offer it.

Release below:

Myriad Completes Synchronica Acquisition to Create the World’s Biggest Mobile Social Messaging Business

ZURICH, Switzerland – 16th April 2012: Myriad Group AG (MYRN: SIX), the company powering billions of rich mobile social and web experiences on any connected device, today announces it has reached the required shareholder approvals to acquire UK-based Synchronica plc.

“This deal will create a powerhouse in the rapidly growing sector of mobile-social convergence,” said Simon Wilkinson, CEO of Myriad. “It will establish a global service organisation serving over 100 Carriers and 25 OEMs around the world. At a stroke, it increases the addressable base for our award-winning product portfolios to over 1.8 billion subscribers with pre-installation of our products in over 100 million new devices each year.”

Myriad has been in discussions with Synchronica plc since early November – and announced the terms of its offer on January 31st 2012. The two businesses currently serve customers including: ATT, Verizon, Vodafone, Telefónica, Orange, T-Mobile, América Móvil, NTT Docomo, MTS, Softbank, Megafon, Telcel, TIM, Airtel and Claro.

Wilkinson concluded, “I would like to thank our shareholders for their support and collective efforts of Myriad’s staff and its advisors during this process. We look forward to working closely with the Synchronica team as they become part of the Myriad Group.”

[Image: EronsPics, Flickr]


Mobile Messaging Consolidates: Myriad Group Buys Synchronica For $38M

LoveThis Launches Social Recommendation ‘Anti-App’ By Adding Facebook, Email Tips To The Mix

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Feeling overloaded by social recommendation apps? Get ready for another one hitting the market, although this one says it will come with a twist: LoveThis, the UK-based social recommendation service that launched last year with $2 million in funding, today has launched an iOS app to let friends recommend across 10 categories, from books and films to places to eat.

But unlike apps like Amen or Foursquare that rely on people using the app to suggest or tag things, this one says it will also take into account recommendations made by contacts elsewhere, such as Facebook and email, who do not have to be signed up to LoveThis to put their two cents into the mex.

And, unlike many other apps that focus first on scale before trying to work in the business model, Alex Dormandy, the CEO of the company, says LoveThis already has a plan here, too. LoveThis is free to use, but the idea will be that something recommended through LoveThis can subsequently be bought via the app. It’s not there yet but is in the works.

“We will have a buy button sitting there at exactly that moment,” he tells me. “And it’s not just people with the app who can buy, non registered friends who receive or make recommendations will also receive the purchase links.”

He says that LoveThis is trying to work some viral elements into the new service as well: while the functionality allows for discussion on your own topics between the app, Facebook and email, LoveThis will also include an invite to download the app if you want to see friends’ other recommendations.

That could come in useful especially in the early days when most people will not have the app. LoveThis doesn’t say how many people have registered with the service since it launched last year, but it picked up around 40,000 recommendations in its first eight weeks of launch: that quick growth speaks to how there is still a hole in the market waiting to be filled. And how people are still looking for the “killer app” that gives them more trusted and intelligent discovery tools beyond the more anonymous search results that you get today.

For now the service works around three points of engagement: the app, Facebook and email. But Dormandy also says that LoveThis is already working on integrating with other social sites like Foursquare and Twitter. “Absolutely there are a lot of options,” he says. “The work on integrating with them is going on now.”

LoveThis should be watched to see if this kind of cross-platform, semi-opted-in model of social networking can work, but another reason to keep an eye on it is because of the track record of the people who behind the startup.

Dormandy is a veteran of Branson’s Virgin group, having founded both Virgin Mobile and the fitness chain Virgin Active. Another exec helped design and launch one of the UK’s biggest online grocery-and-beyond shopping/delivery outfits, Ocado. Angels include Gi Fernando (founder of Techlightenment, later sold to Experian).


LoveThis Launches Social Recommendation ‘Anti-App’ By Adding Facebook, Email Tips To The Mix

Google Takes Its Flipboard Competitor Currents Global

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Last December, Google launched Currents, its attempt at challenging popular mobile apps like Flipboard and Zite. Since then, the company has added about 400 new publishers and over 14,000 self-published editions to its lineup . Until now, though, Currents, which runs on Android and iOS, was only available in the United States. That’s changing today, as Google is taking Currents global. Local publishers can now start adding their content to the app and U.S. publishers can now turn on a translation feature to make their texts available in any of the 44 languages that are supported by Google Translate.

Among the international publishers who are already using Google Currents are The Guardian in the UK, LaStampa in Italy, Financial Times Deutschland in Germany, ABC News in Australia, Neue Zürcher Zeitung in Switzerland and Hindustan Times in India.

The translation feature, though, is what Google really wants to highlight in this release. Given that it’s based on Google Translate, those translations can be a bit rough at times, though they are generally good enough to get the general gist of an article.

This new version of Currents also sports a new “dynamic sync feature,” which ensures that articles are downloaded immediately when you open the app without having to press the sync button. Currents’ users can now also download select editions for offline reading.


Google Takes Its Flipboard Competitor Currents Global