Quick Bytes – May 11th: Co-Founder of Twitter, Ev Williams, Wants to Fix the Internet
A look at the most interesting startup and business-related news stories of the week.
Ev Williams To Fix The Internet
Co-founder of Twitter and now CEO of Medium, Ev Williams is allegedly turning his hand to fix the problems with ad-supported media and the regulation of social platforms. Almost as an antidote to Twitter, Williams is seeking to make Medium a service where people will pay to be part of a community of well-crafted, thoughtful ideas and not be tempted to visit the site multiple times a day, therefore weeding out the goal of addiction as part of a tech business model. With roughly 80 million monthly visitors, Medium is not yet a profitable business. A company spokeswoman said subscription revenue was growing by 50% each quarter so to be confirmed whether the finely crafted model will work.
The Full Story
For years, Ev Williams was saddled with doubts.
As a co-founder of Blogger and Twitter and, more recently, as the chief executive of the digital publishing platform Medium, Mr. Williams transformed the way millions of people publish and consume information online.
But as his empire grew, he started to get a gnawing feeling that something wasn’t right. High-quality publishers were losing out to sketchy clickbait factories. Users were spending tons of time on social media, but they weren’t necessarily happier or better informed. Platforms built to empower the masses were rewarding extremists and attention seekers instead. Read the Full Article Here
Median Pay In Tech Companies
For the first time, the SEC have mandated a rule that all publicly traded companies disclose how their CEOs are compensated compared to their employees. For the large tech companies, this isn’t always interesting reading. The likes of Zuckerberg, Bezos and Musk are paid tiny salaries but are compensated in other ways. However, it is interesting to take a look at how these companies are choosing to offset global outsourcing with Bay Area skills. By and large, the graphs show that companies that require a majority of highly skilled tech workers stay in the Bay Area and pay exceptionally high salaries, whereas companies that have significant production needs – Intel, Amazon and IBM look offshore and significantly reduce costs. Apple, Microsoft and Oracle won’t report on their figures until later this year.
The Full Story
HOW MUCH DO workers at tech firms make?
The answer varies a lot, depending on the employer. The median employee at Amazon made $28,446 last year, according to new disclosures required by the Securities and Exchange Commission. At Facebook, the median employee made $240,430, more than eight times as much.
There are reasons for the big disparity, of course: Facebook’s 25,000 employees include many software engineers, which it must recruit in the expensive and competitive San Francisco Bay Area. Most of Amazon’s 566,000 employees work in its distribution centers, including many overseas; in the US, Amazon says the average hourly wage in its distribution centers is more than $15 an hour, which translates to slightly more than $30,000 a year, before overtime. Read the Full Article Here
Pandora Studies The Right Number Of Ads
Subscription business models are often built around advertising as a primary form of monetization. Getting the right number of ads in an ad-lite model that encourages users to purchase a premium model is a difficult balancing act. Pandora’s latest study shows that, for every additional ad served per hour, premium subscriptions increased by 0.14%, but three users also stopped using Pandora altogether. With Dropbox’s first quarterly financial report released yesterday showing a 24% rise in paying users since last year, the company is showing that adding value, in the form of storage, as opposed to removing ads, is working well for them to convert.
The Full Story
AT BEST, ADVERTISING is something people tolerate while consuming media. At worst, it’s a turnoff. Media companies engage in a delicate balance between showing audiences enough ads to earn a profit without annoying them so much they leave altogether.
A new study by internet radio service Pandora shows that too many ads can motivate users to pay for an ad-free version, but push many more to listen less or abandon the service. The study found that the additional subscription revenue does not make up for the lost ad revenue from those who listen less or leave the service.
The findings are relevant as digital-media companies seek the proper balance of ad-supported and subscription-supported services. As internet users become more comfortable with paying for digital content, media companies from Netflix and Spotify to newspapers and magazines (including WIRED), are showing that subscription business models may be as attractive as free, ad-supported ones. Read the Full Article Here
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