TikTok versus Trump, Facebook’s moderation policies and Snapchat’s comeback helped make it a year to remember
In a normal year, getting to 10 defining tech stories could be a bit of a chore. Not in 2020. Between the antitrust sword hanging over the heads of Google and Facebook, the streaming revolution shifting into overdrive, and the Trump-TikTok showdown, not a day went by this year, seemingly, without tech being front and center.
Admittedly, it could almost be too much to keep up with: Has it really been eight months since Quibi launched, and two months since it shut down?
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Here’s a full recap of the tech stories that shaped 2020:
Content moderation moves to center stage
Facebook and Twitter have been increasingly focused on policing their platforms in recent years, but 2020 is the year content moderation moved front and center. Both companies started cracking down more on content they deemed unfit for their platforms, from Facebook banning all QAnon content to Twitter purging “harmful” tweets that question the effectiveness of COVID-19 vaccines.
This concerted effort to moderate content ultimately led to several run-ins with the president, with both social media giants adding warning labels and fact check notifications to his posts, starting midway through the year. President Trump wasn’t thrilled with this development, even signing an executive order calling on regulators to reconsider the broad legal shield that gives platforms the ability to moderate as they see fit.
The clearest and biggest example that we’ve reached a new level with content moderation, though, came with Twitter’s decision to ban The New York Post’s “potentially harmful” reporting on Hunter Biden, President-elect Joe Biden’s son, shortly before Election Day; Facebook, at the same time, decided to limit the reach of The Post’s Hunter Biden story. That call was fiercely debated, with many saying the companies had overstepped and censored content their users should be able to read. Others lauded the companies for being proactive in looking to weed out Russian disinformation (although that wasn’t the case) considering the companies took a more lax approach to handling the 2016 election.
Whatever side you came down on, Facebook and Twitter doubled down on moderation in 2020. (Whether this was a positive development was debated on the latest episode of Tech Talk, which you can watch by clicking here.)
Quibi’s crash and burn
From the jump, everything seemed a bit off about Quibi. The upstart, mobile-only streaming platform from Jeffrey Katzenberg and Meg Whitman was flush with $1.8 billion in cash and big names like Steven Spielberg attached to create its bit-sized shows. So it was a bit concerning when Quibi’s much-hyped debut at CES 2020 in Las Vegas focused so much on the app’s software and so little on why viewers would actually want to pay $5-$8 per month to watch its shows. That was a red flag — and an omen of things to come.
Things didn’t get much better when Quibi officially launched in April. According to early Quibi users, the app fell short in three key areas: content, technical features and marketing. Those issues made it even harder to win over subscribers in an increasingly saturated streaming space.
Most people who signed up for Quibi in its early days, when the app was offering a free 90-day trial, didn’t even bother to stick around, with only 8% of the first 910,000 people to take advantage of the offer deciding they wanted to pay for Quibi once their trial expired. Add in the fact Quibi became a running joke on Twitter, and it was officially a tire fire. Katzenberg at one point blamed “everything” that went wrong with Quibi’s launch on the pandemic.
By October, it was clear: Viewers were not clamoring for a courtroom show hosted by Chrissy Teigen or a “Punk’d” reboot starring Chance the Rapper. The app was heading towards finishing the year with about 2 million subscribers — well short of the 7.2 million company executives had projected. Under the weight of its underwhelming content, poor word-of-mouth and limp subscriber growth, Quibi officially pulled the plug in late October, abruptly ending one of the biggest tech and media blunders of the 21st Century.
The streaming boom hits warp speed
The COVID-19 pandemic turbo-charged a shift toward streaming that was already underway. With millions of people stuck inside, unable to do much else but hang out on their couch, streaming services like Netflix and Disney+ had huge years. Netflix gained 26 million new customers during the first half of the year — nearly equaling the company’s entire 2019 growth in the process. Disney+, meanwhile, recently announced it had 86.8 million subscribers a little more than a year after debuting, putting the company literally years ahead of its own schedule. Other big-name streamers looked to capitalize on the shift to streaming this year, too, with NBCU’s Peacock and WarnerMedia’s HBO Max both rolling out in 2020. The influx of streaming services has also helped push Roku to new heights, with the popular streaming device-maker seeing its share price more than double in 2020.
Streaming’s rise has also coincided with the continued downfall of traditional TV. About six million U.S. households are projected to cut the cord by the end of the year, setting a new record for the ailing industry. Customers have shown they still love to sit back and turn on the TV — they just prefer to scan their favorite streaming apps for a good show or movie to watch, rather than flip channels.
Big Tech’s big gains on Wall Street
The pandemic may have been a body blow for small businesses across the country, but Big Tech has been thriving. Take a look at the five biggest American companies, all of which are tech companies: Apple, Amazon, Microsoft, Google and Facebook.
Those five companies added a combined $2.28 trillion to their overall valuations this year, with Apple alone seeing its market cap increase by $950 billion since Jan. 1, 2020. COVID-19 ended up making dominant companies even more dominant — and richer — as they flexed their financial and logistical muscles while smaller competitors have struggled to stay afloat.
The antitrust winds are blowing
Google and Facebook may leave 2020 as richer companies, but they’ll also be entering 2021 stuck in the government’s crosshairs. Facebook is facing an antitrust case brought by the FTC and 48 state attorneys general, indicating bipartisan support for breaking up the social media powerhouse. Google, meanwhile, is dealing with no less than three antitrust lawsuits of its own, including one spearheaded by the Justice Department.
Antitrust experts have told TheWrap it’s a toss-up whether these cases will lead to the break up of Google or Facebook, but the mood in Washington, D.C. has clearly shifted. Lawmakers and regulators are looking at the dominance of a select few tech companies more critically, and that means more of Mark Zuckerberg and Sundar Pichai’s time and resources will be spent fighting monopoly claims. Any way you slice it, it’s a headache Facebook and Google wish they didn’t have to deal with.
Trump versus TikTok
Perhaps the single biggest tech story of the year was President Trump taking on TikTok. The president signed an executive order in August, banning TikTok from the U.S. unless ByteDance, its Beijing-based parent company, offloaded its American assets. The reason? President Trump said ByteDance’s close ties to China’s communist government and TikTok’s murky data collection policies made the app a national security threat; TikTok, for its part, has denied ever sharing user information with the Chinese government.
Now, on the eve of 2021, we’re still unsure how this one will end. TikTok reached an agreement in September with Oracle to be its “trust technology provider” in the U.S., an agreement that would also see Oracle and Walmart grab a slice of TikTok Global, a new, U.S.-based offshoot that would look to go public next year. Trump initially gave the deal his “blessing,” but it’s since been stuck in regulatory limbo, as regulators and TikTok squabble over ByteDance turning over more of its American operations than the deal initially set out.
It’ll be interesting to see if the Trump administration scrambles to finish its TikTok battle before President-elect Joe Biden takes office on Jan. 20; it’s already been interesting enough to see the president, with his trade war against China as a backdrop, take on an app that’s only gained steam domestically in 2020, hitting 100 million U.S. users overall.
Snapchat snaps back
Snap Inc. took a long and winding road to get to where it is now. For the first few years after going public in early 2017, things never seemed to click for Snapchat: Instagram was copying some of its core features, namely “Stories,” and pulling in users at a faster clip, while new apps like TikTok came along and grabbed everyone’s attention as the “cool” social app of choice for Millennials and Gen Z’ers. Compounding matters, Snap released a poorly-received Android app update that left investors wondering if CEO Evan Spiegel and company were ever going to figure this thing out as a public company.
Jump to late 2020, and those concerns now appear to be alleviated, with Snap on the verge of surpassing 250 million daily users. Strong user growth, coupled with a revamped advertising strategy that has boosted revenue (sales increased 52% year-over-year during Q3 to $679 million in Q3) has helped turn Snap into a Wall Street darling this year; the company’s emphasis on fresh, 5-10 minute shows and its new gaming platform, which TheWrap reported on earlier this year, is helping to keep users on the app longer, didn’t hurt, either. Those factors have pushed Snap north of $50 per share — marking the first time Snap has surpassed the high-$20 per share range since the first days following its IPO.
Spotify bets big on podcasting
Spotify showed this year it wants to be the biggest platform for audio — not just music streaming — in the world. To get there, the streaming heavyweight unleashed an aggressive podcasting strategy in 2020, gobbling up a number of big-name podcasters for hundreds of millions of dollars and bringing them exclusively to Spotify. Bill Simmons, Kim Kardashian, and Joe Rogan (the biggest name in the industry) all signed exclusive podcasting deals with Spotify this year, as well as Prince Harry and Meghan Markle.
The goal is an ambitious one: to take down Apple as the go-to name in podcasting. Right now, Apple is responsible for 42.7% of all devices downloading podcasts, according to data shared by Chartable. For comparison, Spotify claims 19.9% of all unique podcast downloaders. In other words: It has plenty of room to make up to catch Apple. Investors, at least so far, have loved Spotify’s podcasting game plan, with the company’s share price jumping more than 100% since the start of 2020.
Amazon, meanwhile, mounted its own podcast push in 2020, signing exclusive deals with celebrities like Will Smith and DJ Khaled. Its acquisition of Wondery, the podcast network behind “Dirty John” and several other popular shows, in a deal the Wall Street Journal said is worth more than $300 million, shows Spotify also has to worry about fighting Amazon for podcast listeners.
Work-from-home spurs Silicon Valley/Bay Area exodus
Tech companies like Facebook, Twitter and Google were some of the first, and certainly some of the biggest, companies to adopt work-from-home plans early in the pandemic. But with the need to go into the office suddenly removed, many tech workers decided it was time to skip town. Nearly 90,000 households — or about one-in-four households — fled San Francisco since the start of the pandemic. There are a myriad of factors at play here — local politics, taxes, and lockdown measures to name just a few. But it’s undeniable: The move towards WFH untethered tens of thousands of people and emboldened them to ditch tech’s epicenter. Austin, Texas and Miami, Fla. are two cities worth keeping an eye on now as potential “Silicon Valley East” candidates.
OnlyFans, Substack fuel content creator revolution
Creators gained a new level of independence this year, thanks to a few platforms that are making it easier to directly connect with fans. A number of well-known journalists, including Glenn Greenwald, Andrew Sullivan and Matt Taibbi, made the jump to Substack, a platform dedicated to subscriber-backed email newsletters. From a creative standpoint, Greenwald pointed out the move untethers writers from outlets and editors they may not see eye-to-eye with. And from a business standpoint, it’s helping to make some writers rich. Sullivan, Ben Smith noted in The New York Times, has seen his income rise “from less than $200,000 to around $500,000 as a result of the move.” The financial and editorial flexibility offered to writers with healthy audiences will likely see the Substack revolution carry over into 2021.
The same goes for OnlyFans. The subscription-based social media platform is perhaps best known as a place for adult models and sex workers to post racy pictures and videos in exchange for money from their fans. But it’s also gaining mainstream traction, too, with fitness coaches and stars like Cardi B using it to connect with (and make money off of) their fans.
Now, with 1 million creators and 85 million users, OnlyFans is set to finish 2020 with $400 million in revenue and a billion-dollar valuation. Together with Substack, OnlyFans underscored a new trend in digital media: creators being increasingly willing to go directly to their fans with their content. The old gatekeepers and legacy institutions don’t matter to them as much anymore; as long as there’s a robust audience to work with, many creators this year showed they’d rather cut out the middle man and ask their fans to support their work independently.