Nellie: Hello, boys.
Farhad: Great. O.K., here goes. So, let’s start with Snap. Remember Snap? It made an app that teenagers really loved. They loved it so much people thought it would be the next Facebook. But yeah, no, that didn’t happen. This week Snap’s stock price plummeted after Morgan Stanley, the bank that led the company’s recent I.P.O., issued a report downgrading the company’s shares. Now Snap is trading under $17, its I.P.O. price.
Mike: Talk about a knife in the back. Has Brian Nowak, the Morgan Stanley analyst who wrote the report, not heard of Snapchat’s viral dancing hot dog? Billion-dollar idea right there.
Farhad: What’s ailing Snap? Facebook, obviously. The social giant has copied basically all of Snapchat’s best features. Instagram, also owned by Facebook, seems to have kneecapped Snapchat’s growth. Also, advertisers don’t seem to be warming to Snap’s platform.
What can they do? Is Snap done?
Mike: I don’t think it’s fair to count them out entirely. Snapchat still has a lot of highly engaged users who love the product, and the company is moving into augmented reality, via the aforementioned Mr. Hotdog.
Nellie: People seem to have overestimated how loyal kids are to apps and how impactful stunts like Spectacles are. But mostly I think Snap out-cooled itself. They designed the app to be explained by word-of-mouth, so olds like me couldn’t use it very easily. The only snap I’ve snapped was me asking if I was snapping. That said, it’s worrisome how fast Facebook consumed this company, its last real social competition. And it’s a reminder that we may still be seeing only the beginning of Facebook’s reign.
Mike: Honestly, I feel it’s an issue of expectations. The bankers compared Snap to Facebook during the I.P.O. roadshow. But it’s nowhere near the scale of Facebook, nor will it ever be. That was what Twitter’s bankers did during its I.P.O., and look how well that worked for them in the long term.
My advice, which I take to heart: Underpromise, overdeliver. Snapchat seemed to do the opposite.
Farhad: In other news, the internet celebrated two big events this week. First, Prime Day. On this special day of grace, Peace Be Upon Jeff, we pledged our honor and devotion to Amazon. I picked up a few deals, and Amazon said it rang up huge sales of its Echo devices.
Did you two find any bargains?
Nellie: I did not.
Mike: Um, yeah. I went a little wild and bought a printer and a PlayStation. Paper documents and killing bad guys are two very important things to me. Thankfully, I did not buy 100 knockoff iPhone cables like everyone else.
Farhad: The day after Prime Day, in an odd bit of timing, the internet moved on to the “Day of Action” — a huge online protest in opposition of the Federal Communication Commission’s plan to undo so-called net neutrality regulations. Lots of internet companies altered their sites to show off the horrors they say will come when the government scraps rules meant to prevent broadband companies from blocking or throttling certain sites online. The protests were big, but from my view, they weren’t really internet-stopping; I’d doubt if they changed much of the politics of the issue. Am I wrong?
Nellie: Never thought I’d say this, but you’re completely right. Net neutrality isn’t a charismatic issue, and it’s difficult to galvanize folks to march for internet speed. Net neutrality rules could be scrapped before most people know what they were in the first place.
Mike: Where is John Oliver and his viral video team when you need him?
I agree with Nellie, it seems like a done deal, and quite tough to get into the weeds with folks in a way that would make them care about the issue either way. . I guess it’s time to prepare to watch Netflix originals with the spinning wheel of latency interrupting me every so often?
That was fun! Welcome to the team, Nellie. I look forward to dunking on Farhad together for years to come.
Nellie: I’m so excited to be joining the tech team!
Farhad: I’m so excited to be done talking with Mike for the week. See ya!
Source: New York Times – Technology