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September 21, 2018
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Review: iPhone XS and the power of long-term thinking

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The iPhone XS proves one thing definitively: that the iPhone X was probably one of the most ambitious product bets of all time.

When Apple told me in 2017 that they put aside plans for the iterative upgrade that they were going to ship and went all in on the iPhone X because they thought they could jump ahead a year, they were not blustering. That the iPhone XS feels, at least on the surface, like one of Apple’s most “S” models ever is a testament to how aggressive the iPhone X timeline was.

I think there will be plenty of people who will see this as a weakness of the iPhone XS, and I can understand their point of view. There are about a half-dozen definitive improvements in the XS over the iPhone X, but none of them has quite the buzzword-worthy effectiveness of a marquee upgrade like 64-bit, 3D Touch or wireless charging — all benefits delivered in previous “S” years.

That weakness, however, is only really present if you view it through the eyes of the year-over-year upgrader. As an upgrade over an iPhone X, I’d say you’re going to have to love what they’ve done with the camera to want to make the jump. As a move from any other device, it’s a huge win and you’re going head-first into sculpted OLED screens, face recognition and super durable gesture-first interfaces and a bunch of other genre-defining moves that Apple made in 2017, thinking about 2030, while you were sitting back there in 2016.

Since I do not have an iPhone XR, I can’t really make a call for you on that comparison, but from what I saw at the event and from what I know about the tech in the iPhone XS and XS Max from using them over the past week, I have some basic theories about how it will stack up.

For those with interest in the edge of the envelope, however, there is a lot to absorb in these two new phones, separated only by size. Once you begin to unpack the technological advancements behind each of the upgrades in the XS, you begin to understand the real competitive edge and competence of Apple’s silicon team, and how well they listen to what the software side needs now and in the future.

Whether that makes any difference for you day to day is another question, one that, as I mentioned above, really lands on how much you like the camera.

But first, let’s walk through some other interesting new stuff.

Notes on durability

As is always true with my testing methodology, I treat this as anyone would who got a new iPhone and loaded an iCloud backup onto it. Plenty of other sites will do clean room testing if you like metrics porn, but I really don’t think that does most folks much good. Instead, I try to take them along on prototypical daily carries, whether to work for TechCrunch, on vacation or doing family stuff. A foot injury precluded any theme parks this year (plus, I don’t like to be predictable) so I did some office work, road travel in the center of California and some family outings to the park and zoo. A mix of uses cases that involves CarPlay, navigation, photos and general use in a suburban environment.

In terms of testing locale, Fresno may not be the most metropolitan city, but it’s got some interesting conditions that set it apart from the cities where most of the iPhones are going to end up being tested. Network conditions are pretty adverse in a lot of places, for one. There’s a lot of farmland and undeveloped acreage and not all of it is covered well by wireless carriers. Then there’s the heat. Most of the year it’s above 90 degrees Fahrenheit and a good chunk of that is spent above 100. That means that batteries take an absolute beating here and often perform worse than other, more temperate, places like San Francisco. I think that’s true of a lot of places where iPhones get used, but not so much the places where they get reviewed.

That said, battery life has been hard to judge. In my rundown tests, the iPhone XS Max clearly went beast mode, outlasting my iPhone X and iPhone XS. Between those two, though, it was tougher to tell. I try to wait until the end of the period I have to test the phones to do battery stuff so that background indexing doesn’t affect the numbers. In my ‘real world’ testing in the 90+ degree heat around here, iPhone XS did best my iPhone X by a few percentage points, which is what Apple does claim, but my X is also a year old. I didn’t fail to get through a pretty intense day of testing with the XS once though.

In terms of storage I’m tapping at the door of 256GB, so the addition of 512GB option is really nice. As always, the easiest way to determine what size you should buy is to check your existing free space. If you’re using around 50% of what your phone currently has, buy the same size. If you’re using more, consider upgrading because these phones are only getting faster at taking better pictures and video and that will eat up more space.

The review units I was given both had the new gold finish. As I mentioned on the day, this is a much deeper, brassier gold than the Apple Watch Edition. It’s less ‘pawn shop gold’ and more ‘this is very expensive’ gold. I like it a lot, though it is hard to photograph accurately — if you’re skeptical, try to see it in person. It has a touch of pink added in, especially as you look at the back glass along with the metal bands around the edges. The back glass has a pearlescent look now as well, and we were told that this is a new formulation that Apple created specifically with Corning. Apple says that this is the most durable glass ever in a smartphone.

My current iPhone has held up to multiple falls over 3 feet over the past year, one of which resulted in a broken screen and replacement under warranty. Doubtless multiple YouTubers will be hitting this thing with hammers and dropping it from buildings in beautiful Phantom Flex slo-mo soon enough. I didn’t test it. One thing I am interested in seeing develop, however, is how the glass holds up to fine abrasions and scratches over time.

My iPhone X is riddled with scratches both front and back, something having to do with the glass formulation being harder, but more brittle. Less likely to break on impact but more prone to abrasion. I’m a dedicated no-caser, which is why my phone looks like it does, but there’s no way for me to tell how the iPhone XS and XS Max will hold up without giving them more time on the clock. So I’ll return to this in a few weeks.

Both the gold and space grey iPhones XS have been subjected to a coating process called physical vapor deposition or PVD. Basically metal particles get vaporized and bonded to the surface to coat and color the band. PVD is a process, not a material, so I’m not sure what they’re actually coating these with, but one suggestion has been Titanium Nitride. I don’t mind the weathering that has happened on my iPhone X band, but I think it would look a lot worse on the gold, so I’m hoping that this process (which is known to be incredibly durable and used in machine tooling) will improve the durability of the band. That said, I know most people are not no-casers like me so it’s likely a moot point.

Now let’s get to the nut of it: the camera.

Bokeh let’s do it

I’m (still) not going to be comparing the iPhone XS to an interchangeable lens camera because portrait mode is not a replacement for those, it’s about pulling them out less. That said, this is closest its ever been.

One of the major hurdles that smartphone cameras have had to overcome in their comparisons to cameras with beautiful glass attached is their inherent depth of focus. Without getting too into the weeds (feel free to read this for more), because they’re so small, smartphone cameras produce an incredibly compressed image that makes everything sharp. This doesn’t feel like a portrait or well composed shot from a larger camera because it doesn’t produce background blur. That blur was added a couple of years ago with Apple’s portrait mode and has been duplicated since by every manufacturer that matters — to varying levels of success or failure.

By and large, most manufacturers do it in software. They figure out what the subject probably is, use image recognition to see the eyes/nose/mouth triangle is, build a quick matte and blur everything else. Apple does more by adding the parallax of two lenses OR the IR projector of the TrueDepth array that enables Face ID to gather a 9-layer depth map.

As a note, the iPhone XR works differently, and with less tools, to enable portrait mode. Because it only has one lens it uses focus pixels and segmentation masking to ‘fake’ the parallax of two lenses.

With the iPhone XS, Apple is continuing to push ahead with the complexity of its modeling for the portrait mode. The relatively straightforward disc blur of the past is being replaced by a true bokeh effect.

Background blur in an image is related directly to lens compression, subject-to-camera distance and aperture. Bokeh is the character of that blur. It’s more than just ‘how blurry’, it’s the shapes produced from light sources, the way they change throughout the frame from center to edges, how they diffuse color and how they interact with the sharp portions of the image.

Bokeh is to blur what seasoning is to a good meal. Unless you’re the chef, you probably don’t care what they did you just care that it tastes great.

Well, Apple chef-ed it the hell up with this. Unwilling to settle for a templatized bokeh that felt good and leave it that, the camera team went the extra mile and created an algorithmic model that contains virtual ‘characteristics’ of the iPhone XS’s lens. Just as a photographer might pick one lens or another for a particular effect, the camera team built out the bokeh model after testing a multitude of lenses from all of the classic camera systems.

I keep saying model because it’s important to emphasize that this is a living construct. The blur you get will look different from image to image, at different distances and in different lighting conditions, but it will stay true to the nature of the virtual lens. Apple’s bokeh has a medium-sized penumbra, spreading light out from light sources but not blowing them out. It maintains color nicely, making sure that the quality of light isn’t obscured like it is with so many other portrait applications in other phones that just pick a spot and create a circle of standard gaussian or disc blur.

Check out these two images, for instance. Note that when the light is circular, it retains its shape, as does the rectangular light. It is softened and blurred, as it would when diffusing through the widened aperture of a regular lens. The same goes with other shapes in reflected light scenarios.

Now here’s the same shot from an iPhone X, note the indiscriminate blur of the light. This modeling effort is why I’m glad that the adjustment slider proudly carries f-stop or aperture measurements. This is what this image would look like at a given aperture, rather than a 0-100 scale. It’s very well done and, because it’s modeled, it can be improved over time. My hope is that eventually, developers will be able to plug in their own numbers to “add lenses” to a user’s kit.

And an adjustable depth of focus isn’t just good for blurring, it’s also good for un-blurring. This portrait mode selfie placed my son in the blurry zone because it focused on my face. Sure, I could turn the portrait mode off on an iPhone X and get everything sharp, but now I can choose to “add” him to the in-focus area while still leaving the background blurry. Super cool feature I think is going to get a lot of use.

It’s also great for removing unwanted people or things from the background by cranking up the blur.

And yes, it works on non humans.

If you end up with an iPhone XS, I’d play with the feature a bunch to get used to what a super wide aperture lens feels like. When its open all the way to f1.4 (not the actual widest aperture of the lens btw, this is the virtual model we’re controlling) pretty much only the eyes should be in focus. Ears, shoulders, maybe even nose could be out of the focus area. It takes some getting used to but can produce dramatic results.

Developers do have access to one new feature though, the segmentation mask. This is a more precise mask that aids in edge detailing, improving hair and fine line detail around the edges of a portrait subject. In my testing it has led to better handling of these transition areas and less clumsiness. It’s still not perfect, but it’s better. And third-party apps like Halide are already utilizing it. Halide’s co-creator, Sebastiaan de With, says they’re already seeing improvements in Halide with the segmentation map.

“Segmentation is the ability to classify sets of pixels into different categories,” says de With. “This is different than a “Hot dog, not a hot dog” problem, which just tells you whether a hot dog exists anywhere in the image. With segmentation, the goal is drawing an outline over just the hot dog. It’s an important topic with self driving cars, because it isn’t enough to tell you there’s a person somewhere in the image. It needs to know that person is directly in front of you. On devices that support it, we use PEM as the authority for what should stay in focus. We still use the classic method on old devices (anything earlier than iPhone 8), but the quality difference is huge.

The above is an example shot in Halide that shows the image, the depth map and the segmentation map.

In the example below, the middle black-and-white image is what was possible before iOS 12. Using a handful of rules like, “Where did the user tap in the image?” We constructed this matte to apply our blur effect. It’s no bad by any means, but compare it to the image on the right. For starters, it’s much higher resolution, which means the edges look natural.

My testing of portrait mode on the iPhone XS says that it is massively improved, still some quirks that will lead to weirdness and it’s not quite aggressive enough on foreground objects — those should blur too but only sometimes do. But the quirks are overshadowed by the super cool addition of the adjustable background blur.

Live preview of the depth control is not in iOS 12 at the launch of the iPhone XS, but it will be coming in a future version of iOS 12 this fall.

I also shoot a huge amount of photos with the telephoto lens. It’s closer to what you’d consider to be a standard lens on a camera. The normal lens is really wide and once you acclimate to the telephoto you’re left wondering why you have a bunch of pictures of people in the middle of a ton of foreground and sky. If you haven’t already, I’d say try defaulting to 2x for a couple of weeks and see how you like your photos. For those tight conditions or really broad landscapes you can always drop it back to the wide. Because of this, any iPhone that doesn’t have a telephoto is a basic non-starter for me, which is going to be one of the limiters on people moving to iPhone XR from iPhone X, I believe. Even iPhone 8 Plus users who rely on the telephoto I believe will miss it if they don’t go to the XS.

But, man, Smart HDR is where it’s at

I’m going to say something now that is surely going to cause some Apple followers to snort, but it’s true. Here it is:

For a company as prone to hyperbole and Maximum Force Enthusiasm about its products, I think that they have dramatically undersold how much improved photos are from the iPhone X to the iPhone XS. It’s extreme, and it has to do with a technique Apple calls Smart HDR.

Smart HDR on the iPhone XR encompasses a bundle of techniques and technology including highlight recovery, rapid-firing the sensor, an OLED screen with much improved dynamic range and the Neural Engine/image signal processor combo. It’s now running faster sensors and offloading some of the work to the CPU, which enables firing off nearly two images for every one it used to in order to make sure that motion does not create ghosting in HDR images, it’s picking the sharpest image and merging the other frames into it in a smarter way and applying tone mapping that produces more even exposure and color in the roughest of lighting conditions.

iPhone XS shot, better range of tones, skintone and black point

iPhone X Shot, not a bad image at all, but blocking up of shadow detail, flatter skin tone and blue shift

Nearly every image you shoot on an iPhone XS or iPhone XS Max will have HDR applied to it. It does it so much that Apple has stopped labeling most images with HDR at all. There’s still a toggle to turn Smart HDR off if you wish, but by default it will trigger any time it feels it’s needed.

And that includes more types of shots that could not benefit from HDR before. Panoramic shots, for instance, as well as burst shots, low light photos and every frame of Live Photos is now processed.

The results for me have been massively improved quick snaps with no thought given to exposure or adjustments due to poor lighting. Your camera roll as a whole will just suddenly start looking like you’re a better picture taker, with no intervention from you.

Under the hood

As far as Face ID goes, there has been no perceivable difference for me in speed or number of positives, but my facial model has been training on my iPhone X for a year. It’s starting fresh on iPhone XS. And I’ve always been lucky that Face ID has just worked for me most of the time. The gist of the improvements here are jumps in acquisition times and confirmation of the map to pattern match. There is also supposed to be improvements in off-angle recognition of your face, say when lying down or when your phone is flat on a desk. I tried a lot of different positions here and could never really definitively say that iPhone XS was better in this regard, though as I said above, it very likely takes training time to get it near the confidence levels that my iPhone X has stored away.

In terms of CPU performance the world’s first 7nm architecture has paid dividends. You can see from the iPhone XS benchmarks that it compares favorably to fast laptops and easily exceeds iPhone X performance.

The Neural Engine and better A12 chip has meant for better frame rates in intense games and AR, image searches, some small improvement in app launches. One easy way to demonstrate this is the video from the iScape app, captured on an iPhone X and an iPhone XS. You can see how jerky and FPS challenged the iPhone X is in a similar AR scenario. There is so much more overhead for AR experiences I know developers are going to be salivating for what they can do here.

The stereo sound is impressive, surpassingly decent separation for a phone and definitely louder. The tradeoff is that you get asymmetrical speaker grills so if that kind of thing annoys you you’re welcome.

Upgrade or no

Every other year for the iPhone I see and hear the same things — that the middle years are unimpressive and not worthy of upgrading. And I get it, money matters, phones are our primary computer and we want the best bang for our buck. This year, as I mentioned at the outset, the iPhone X has created its own little pocket of uncertainty by still feeling a bit ahead of its time.

I don’t kid myself into thinking that we’re going to have an honest discussion about whether you want to upgrade from the iPhone X to iPhone XS or not. You’re either going to do it because you want to or you’re not going to do it because you don’t feel it’s a big enough improvement.

And I think Apple is completely fine with that because iPhone XS really isn’t targeted at iPhone X users at all, it’s targeted at the millions of people who are not on a gesture-first device that has Face ID. I’ve never been one to recommend someone upgrade every year anyway. Every two years is more than fine for most folks — unless you want the best camera, then do it.

And, given that Apple’s fairly bold talk about making sure that iPhones last as long as they can, I think that it is well into the era where it is planning on having a massive installed user base that rents iPhones from it on a monthly or yearly or biennial period. Because that user base will need for-pay services that Apple can provide.

With the iPhone XS, we might just be seeing the true beginning of the iPhone-as-a-service era.

News Source = techcrunch.com

Everyday home gear made smart

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Editor’s note: This post was done in partnership with Wirecutter. When readers choose to buy Wirecutter’s independently chosen editorial picks, Wirecutter and TechCrunch may earn affiliate commissions.

If you only have one smart home device, it’s likely something simple and fun like a voice-controlled speaker or color-changing LED light bulb. As you expand your smart home setup, you can begin to swap out gear that isn’t as flashy but you still use everyday.

Switching to connected locks, power outlets and smoke alarms are all simple installs that can improve your safety and comfort in your own home. We’ve pulled together some of our favorite essentials made smart for anyone looking to upgrade.

Smart lock: Kwikset Kevo Smart Lock 2nd Gen

The Kwikset Kevo Smart Lock 2nd Gen is the most versatile smart lock that we’ve tested. Whether you prefer to use a wireless fob, smartphone app or key, you’ll be able to control the lock with all of them. When we compared it to similar models, the Kevo’s Bluetooth-activated tap-to-unlock mechanism was the easiest to use.

The second generation of the Kevo improved on security and has all-metal internal components for better protection against forced break-in attempts. With the optional Kevo Plus upgrade, you’ll add the ability to control the lock remotely and receive status-monitoring updates.

Photo: Liam McCabe

Robot Vacuum: iRobot Roomba 960

If cleaning is neither your forte or preferred pastime, a robot vacuum will come in handy. Our upgrade pick, the iRobot Roomba 960, is one of the most powerful models that we tested. It can be controlled through the iRobot Home app and uses a bump-and-track navigation system that helps vacuum an entire floor without missing spots.

If its battery is running low during a session, it’ll return to its dock to power up before finishing the job. It’s easy to disassemble for maintenance and is equipped with repairable parts that make it worth its price over some of our less serviceable picks.

Photo: Rachel Cericola

Plug-in Smart Outlet: Belkin Wemo Mini

We tested 26 smart outlet models over more than 45 hours and chose the Belkin Wemo Mini Wi-Fi plug as our top pick. If you’ve ever thought it’d be nice to remotely turn on or off home essentials such as lamps, air conditioners and fans from your smartphone, plugging them into a smart outlet makes it possible.

The Wemo Mini has proven to be reliable throughout long-term testing, it doesn’t block other outlets on the same wall plate and it’s compatible with iOS and Android devices and assistants, including HomeKit/Siri, Alexa and Google Assistant. The interface of the Wemo app is intuitive and easy to use. You can view all of your connected devices on one screen, set powering timers and from anywhere power on or off a device plugged into the Wemo outlet.

Photo: Jennifer Pattison Tuohy

Smart Thermostat: Nest Thermostat E

For a smart thermostat that’s affordable and doesn’t require extensive programming, we recommend the Nest Thermostat E. After about a week, it creates a schedule after learning cooling and heating preferences that you’ve set. It isn’t compatible with as many HVAC systems as similar Nest models, but it’s easy to install and doesn’t lack any features we expect.

It does come with Eco Mode — an energy-saving geofencing feature that detects when your home is empty (or when your smartphone is nowhere near your house). The Nest app uses the same technology to set the thermostat to a preferred temperature when it senses you’re on your way home. If you don’t have your smartphone on hand, you can still operate the Thermostat E by turning its outer ring and pressing selections on its touchscreen.

Photo: Michael Hession

Smart Smoke Alarm: Nest Protect

A smoke alarm is one of the most relied-upon safety devices in every home. Nonetheless, it’s easy to forget to do routine checks to ensure it’s in tip-top shape and functioning properly. With a smart smoke alarm like the Nest Protect, we found that its simple app, self-tests, monthly sound checks and consistent alerts are enough to keep fire safety worries at bay.

It isn’t difficult to install, has a sleek design and integrates with other smart home devices like the Nest Cam (which can record video of a fire) and the Nest Learning Thermostat (which shuts down HVAC systems that may be the cause of a fire). It’s sensitive to fast- and slow-burning fires, plus it monitors homes for both smoke and carbon monoxide.

These picks may have been updated by Wirecutter. When readers choose to buy Wirecutter’s independently chosen editorial picks, Wirecutter and TechCrunch may earn affiliate commissions.

News Source = techcrunch.com

Kegel trainer startup Elvie is launching a smaller, smarter, hands-free breast pump

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Elvie, a Berlin-based startup known best for its connected Kegel trainer is jumping into the breast pump business with a new $480 hands-free system you can slip into your bra.

Even with all the innovation in baby gear, breast pumps have mostly sucked (pun intended) for new moms for the past half a century. My first experience with a pump required me to stay near a wall socket and hunch over for a good twenty to thirty minutes for fear the milk collected might spill all over the place (which it did anyway, frequently). It was awful!

Next I tried the Willow Pump, an egg-shaped, connected pump meant to liberate women everywhere with its small and mobile design. It received glowing reviews, though my experience with it was less than stellar.

The proprietary bags were hard to fit in the device, filled up with air, cost 50 cents each (on top of the $500 pump that insurance did not cover), wasted many a golden drop of precious milk in the transfer and I had to reconfigure placement several times before it would start working. So I’ve been tentatively excited about the announcement of Elvie’s new cordless (and silent??) double breast pump.

Displayed: a single Elive pump with accompanying app.

Elvie tells TechCrunch its aim all along has been to make health tech for women and that it has been working on this pump for the past three years.

The Elvie Pump is a cordless, hands-free, closed system, rechargeable electric pump designed by former Dyson engineers. It can hold up to 5 oz from each breast in a single use.

It’s most obvious and direct competition is the Willow pump, another “wearable” pump moms can put right in their bra and walk around in, hands free. However, unlike the Willow, Elvie’s pump does not need proprietary bags. You just pump right into the device and the pump’s smartphone app will tell you when each side is full.

It’s also half the size and weight of a Willow and saves every precious drop it can by pumping right into the attached bottle so you just pump and feed (no more donut-shaped bags you have to cut open and awkwardly pour into a bottle).

On top of that, Elvie claims this pump is silent. No more loud suction noise off and on while trying to pump in a quiet room in the office or elsewhere. It’s small, easy to carry around and you can wear it under your clothes without it making a peep! While the Willow pump claims to be quiet — and it is, compared to other systems –you can still very much hear it while you are pumping.

Elvie’s connected breast pump app

All of these features sound fantastic to this new (and currently pumping) mom. I remember in the early days of my baby’s life wanting to go places but feeling stuck. I was chained to not just all the baby gear, hormonal shifts and worries about my newborn but to the pump and feed schedule itself, which made it next to impossible to leave the house for the first few months.

My baby was one of those “gourmet eaters” who just nursed and nursed all day. There were days I couldn’t leave the bed! Having a silent, no mess, hands-free device that fit right in my bra would have made a world of difference.

However, I mentioned the word “tentatively” above as I have not had a chance to do a hands-on review of Elvie’s pump. The Willow pump also seemed to hold a lot of promise early on, yet left me disappointed.

To be fair, the company’s customer service team was top-notch and did try to address my concerns. I even went through two “coaching” sessions but in the end it seemed the blame was put on me for not getting their device to work correctly. That’s a bad user experience if you are blaming others for your design flaws, especially new and struggling moms.

Both companies are founded by women and make products for women — and it’s about time. But it seems as if Elvie has taken note of the good and bad in their competitors and had time to improve upon it — and that’s what has me excited.

As my fellow TechCrunch writer Natasha put it in her initial review of Elvie as a company, “It’s not hyperbole to say Elvie is a new breed of connected device. It’s indicative of the lack of smart technology specifically — and intelligently — addressing women.”

So why the pump? “We recognized the opportunity [in the market] was smarter tech for women,” Boler told TechCrunch on her company’s move into the breast pump space. “Our aim is to transform the way women think and feel about themselves by providing the tools to address the issues that matter most to them, and Elvie Pump does just that.”

The Elvie Pump comes in three sizes and shapes to fit the majority of breasts and, in case you want to check your latch or pump volume, also has transparent nipple shields with markings to help guide the nipple to the right spot.

The app connects to each device via Bluetooth and tracks your production, detects let down, will pause when full and is equipped to pump in seven different modes.

The pump retails for $480 and is currently available in the U.K. However, those in the U.S. will have to wait till closer to the end of the year to get their hands on one. According to the company, It will be available on Elvie.com and Amazon.com, as well in select physical retail stores nationally later this year, pending FDA approval.

News Source = techcrunch.com

Latin America is the next stage in the race for dominance in the ride-hailing market

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As the number of competitors in the ride-hailing industry dwindles, geographic expansion is emerging as the next proving ground to determine who will be the victor in the ride-hailing market.

The race for control of the industry, which is estimated by Goldman Sachs to grow eightfold to $285 billion by 2030, is escalating with China’s Didi Chuxing already surpassing Uber as the most valuable startup in the world. With a recent valuation of approximately $56 billion, compared to Uber’s $48 billion, Didi is posing a real threat to Uber’s operations and shows no signs of slowing down. Cementing its position as the top ride-hailing service in China, Didi is now turning its attention to another region of the world that is still filled with vast opportunities and not yet dominated by a single taxi alternative: Latin America.

While many ride-hailing and sharing services have already sprung up and faced regulation in cities across Latin America such as Mexico City, Montevideo, and São Paulo, the region still presents an enormous opportunity for the companies that can adapt and move fast enough.

The current opportunities in Latin America

Unlike many other regions of the world, Latin America is still very much reliant on traditional forms of public transportation such as buses, trains, and subway systems. What’s more, larger cities such as São Paulo, Mexico City, and Bogota simply cannot support any more vehicles on the road without an infrastructure overhaul. Large metro areas are already at or above maximum capacity during peak hours, making owning and commuting with a car more of a hassle than a luxury. As a result, many commuters across Latin America are putting less importance on owning a vehicle and opting to use alternative modes of transportation and on-demand services instead.

Beyond the rising demand for alternative transportation options, it’s also worth noting that Latin America is the world’s second-fastest-growing mobile market. In a region of approximately 640 million people, there are more than 200 million smartphone users. By 2020, predictions say that 63% of Latin America’s population will have access to the mobile Internet. Latin American smartphone users have quickly adopted global apps, such as Uber and Facebook. However, tech companies have yet to fully tap into the region’s potential.

Chilean taxi drivers demonstrate along Alameda Avenue against US on-demand ride service giant Uber, in Santiago, on July 10, 2017.
Uber smartphone app has faced stiff resistance from traditional taxi drivers the world over, as well as bans in some places over safety concerns and questions over legal issues, including taxes. (MARTIN BERNETTI/AFP/Getty Images)

The key players

Uber

According to a Dalia survey, Latin Americans with smartphones that live in urban areas are the most likely to have used a ride-hailing app or site. Overall, 45% have used an app, with Mexico taking the top position in the region at 58%.

Uber entered Latin America in 2013 and claims to have more than 36 million active users in the region, proving employment for more than a million drivers. The company quickly dominated Mexico, which is now its second-largest market after the U.S. In fact, up until recently Uber claimed a near monopoly on ride-sharing in Mexico with few competitors. Uber also has operations in more than 16 Latin American countries.

99 (formerly 99Taxis)

With an urban population of approximately 180 million, Brazil is the ultimate prize for ride-hailing and taxi companies with several services competing for market share. Most notably, 99 (formerly “99Taxis”) was able to gain momentum early on with exclusive services that extended beyond basic ride-hailing (such as its 99 TOP and 99 POP services) and better tools for its drivers.

With over 200,000 drivers and 14 million users, 99 attracted the attention of investors worldwide, including that of China’s Didi Chuxing. Didi invested $100 million into 99 in January 2018 before acquiring 99 entirely months later for nearly $1 billion to take on Uber in Latin America, shortly after it acquired Uber’s operations in China.

Easy Taxi

Rocket Internet -backed taxi booking service, Easy Taxi, started in Latin America in 2011, two years after Uber first started in San Francisco. The company provides an easy way to book a taxi and track it in real-time. Today, the company is owned by Maxi Mobility, which acquired the company from Rocket Internet in 2017 for an undisclosed amount. Maxi Mobility also owns Cabify, and operates across many Latin American markets, including Argentina, Mexico, Bolivia, Panama, Brazil, Peru, and Chile, in addition to a handful of markets elsewhere.

To solidify its position in the region, Easy Taxi merged with Colombian taxi-booking app Tappsi in 2015. Tappsi launched in Bogotá in 2012 and was doing quite well in the Colombian market. The merger allowed the companies to pool their resources just as other competitors, such as Uber, began entering the region.

Easy Taxi maintains impressive traction, raising more than $75 million to date. But as the ride-hailing battle in Latin America pushes forward, the company is rumored to be a likely investment or acquisition target for Uber, Didi, or the largest global investor in this space, Softbank.

Cabify

Cabify is a Spanish company that provides private vehicles for hire via its smartphone app. Although founded in Madrid, Cabify has always positioned itself as a Latin American company, investing heavily across the region. The company was able to gain a strong foothold due to some significant funding raised by its parent company, Maxi Mobility. In January 2018, Maxi Mobility raised another $160 million and said the funding would be used to accelerate both of its companies, Cabify and Easy Taxi, in the 130 cities where they operate throughout Spain, Portugal, and Latin America.

Cabify reported it has over 13 million users and grew its installed-base by 500% between 2016 and 2017, tripling its user base and fulfilling six times more trips in 2017.

Cabify competes directly with Uber, 99, and Easy Taxi in Brazil; however, it reportedly has around 40% market share in Sao Pãolo, one of the largest cities in all of Latin America.

Smaller players to watch

Beat (Formerly Taxibeat)

Beat is a profitable ride-hailing service founded in Athens, Greece that also operates in Peru. Beat is slowly expanding its operations across Latin America, though expansion appears to be limited to Chile for now.

As of January 2017, Beat had around 15,000 drivers and 800,000 customers in Peru.

Nekso

Toronto-based Nekso bet on the Latin American taxi-hailing market before its home market with a pilot launch in Venezuela in 2016. Nekso was able to gain acceptance from the taxi industries in Venezuela, Dominican Republic, Ecuador, and Panama with its slightly different approach to ride-hailing.

The company connects a network of 550+ licensed taxi companies with thousands of drivers and allows users to flag down a cab off the street and without using in-app requests. Nekso also uses artificial intelligence technology to offer drivers real-time updates on weather, events, and traffic data to predict areas of a city which may need more drivers. The company claims taxi drivers can spend up to two-thirds of their day looking for or waiting for riders and that Nekso technology helps drivers increase their daily rides by more than 25% percent.

At the end of 2017, Nekso boasted around 150,000 users and facilitated approximately 400,000 rides per month. Now, the company plans to make its debut in Canada as well as expand to more countries in South America, including Argentina, Colombia, Chile, and Peru.

Didi, 99, and the next phase

99’s new owner, Didi, which dominates the Asian market and was able to defeat Uber in China, has big plans for international expansion. Its acquisition of 99 reveals the potential it sees in Latin America but also adds to the complicated web of global ride-hailing services.

After Didi shut down and acquired Uber’s assets in China, it also bought a stake in Uber for $1 billion. Uber, Didi, and 99 are all backed by Softbank. However, everywhere outside of China, Didi and Uber are competing with each other. Didi’s full plans for 99 are not yet obvious, but the company has already set up an office in Mexico and begun poaching staff from Uber in Mexico.

With an infusion of capital, Latin America’s ride-hailing industry is multiplying. That said, companies that want to compete in the region will need to use an aggressive and strategic approach that can withstand the uniqueness of commuters and transportation options in the region. It’s only a matter of time until we see if these companies continue ramping up their operations for geographic domination, or if we see more and more partner up to advance their technologies and address other looming threats – such as bike sharing, scooter sharing, and even autonomous vehicles.

Two of the founders of 99, who sold their company to Didi, have already launched a dockless bike sharing startup called Yellow in Brazil and raised $9 million to grow its operations. No other scooter company has taken the plunge into Latin America yet besides Grin Scooters in Mexico City, but other larger cities such as Buenos Aires, Bogota, Santiago, and Lima would be ideal markets if the companies can figure out pricing as well as security and safety issues first.

Didi’s activity in Brazil and Mexico is sure to trigger a new wave of competition between existing ride-hailing players and create an even more tangled web of alliances and acquisitions. Whether or not these companies can adapt and move fast enough to rise to the top, and deal with the other looming alternative modes of transportation, remains to be seen.

News Source = techcrunch.com

Is China’s digital silk road going to pave over Silicon Valley?

in alibaba/alibaba group/Business/China/Column/Delhi/Economy/Entrepreneur/Entrepreneurship/Europe/Food/Getty-Images/India/latin america/Politics/Private equity/smartphone/Start-Up Chile/Startup company/TC/Technology/United States/Venture Capital by

Over the past 20 years, China has now grown into one of the largest consumer technology markets, with thousands of startups and funding rivaling Silicon Valley.

In 2018, Chinese entrepreneurs are seeking to expand their businesses beyond borders, establish international operations, and become global companies by listing on exchanges including the NASDAQ and NYSE.

More than ever Chinese entrepreneurs are confident in their ability to create a unicorn thanks to China’s digital transformation and its leading innovations in international markets.

Digital transformation through new native apps and services make scaling easier

Despite the talent war between China and the U.S. and large growing domestic markets, Chinese chief executives dream of successfully entering the U.S. Market. There is now global competition to attract Chinese startups to list on exchanges around the world. With a growing number of unicorns, entrepreneurs have an opportunity to go abroad and become global businesses by listing on foreign stock exchanges.

Today, China’s landscape is fueled by ideas, aspirations, and a desire to succeed at all costs. With slowing growth, many startups have begun to look abroad for growth and opportunities.

Throughout my career I have been fortunate to have a front seat to the local market as it has evolved over the past 20 years. As host to many Chinese entrepreneurs as friends and partners, I have noticed a single trend — Chinese entrepreneurs are infatuated with the US market, despite being a smaller market with more competition.

To succeed, Chinese entrepreneurs are seeking to list in International markets rather than the local stock market. In the second quarter of this year Chinese startups have attracted 47% of all global venture capital. To win highly competitive deals, China’s newly formed talent networks, a willingness to invest and expand, and eagerness to learn are the key to success for cross-border entrepreneurs who are looking for attention on the global stage.

In 2010, I was fortunate to be part of a room of Chinese entrepreneurs who visited the United States. They were all incredibly appreciative of the opportunities their companies had provided for them and dreamed of an IPO or raising capital in the United States. These companies were humble, hungry, and had products that had reached global scale with hundreds of users.

(Photo by Artur Widak/NurPhoto via Getty Images)

Global Aspirations

The Silicon Valley dream rings true for entrepreneurs around the world. Over the past 20 years, Silicon Valley has been a special place where startups were born. But in 2004, I took the first trip to meet with entrepreneurs in China and was fascinated by their technical ability, their focus to solve everyday problems, and ability to build teams and execute. The entrepreneurial dream continues to bring them here to the United States. Their ambitions are out of respect and a desire to play a part on the global stage and participate in the global conversation.

As they do there are a few advantages that Chinese entrepreneurs have in the current market.

1 – Mobile Internet adoption

Mobile Internet adoption in China is now at 48%, and is amongst the highest in the world. With 750 million active users and increasing time spent on the mobile screen, the mobile phone is a lifeline that is now as essential as bank accounts. Thanks to this digital transformation, it does not feel like digital wallets are hurting for adoption in China’s major cities where all workers are used to mobile payments with complete strangers for everything from short taxi rides, bike rides, or food from the local street food vendor.

2 – Large Local Market

China’s local Internet market is anchored by local investment that helps companies grow and scale. With competitive rounds, and a growing number of entrepreneurs from around the world, Chinese startups raised $25 billion last year. Many of these startups raise the capital locally since many of their operations and revenues come from the local market. With an increasing concern over regulation over things like capital controls, many entrepreneurs look to international financing options to grow and scale their businesses to other Internet users around the world.

3 – Digital Economy

China’s digital economy is more complex and mature than other parts of the world. More than 75% of China’s smartphone users are active users of mobile payments. The phone has become the center of China’s netizens. Their behavior is changing the way people market, discover, purchase, and deliver products and services. Whether it be classes on the phone to learn English, or buying a In the world of consumer and mobile startups, China is building the infrastructure as we speak. But with existing channels, and supply chains, entrepreneurs are able to build products and services that can scale beyond their borders. In China, there are now over 100billion mobile transactions happening on the phone.

(Photo credit should read JACQUELYN MARTIN/AFP/Getty Images)

Where does this leave things?

China is pulling ahead. With the mobile phone now home to 100 apps that people use to connect, communicate, eat, and share, Chinese companies are reaching profit and scale and looking to explore international markets.

Chinese entrepreneurs are just beginning to explore international markets. In the past, entrepreneurs came here to establish small teams to build partnerships. In the past decade, Chinese companies have been some of the leading acquirers of technology companies. Before its IPO, Alibaba acquired 95 startups in Silicon Valley and around the world.

We see Chinese technology startups looking to be global. From publishing world-class research, they are seeking connections to the global market, serving the overseas Chinese population around the world in the US, Europe, and Latin America, and looking for partners who can help them achieve the entrepreneur’s dream of a global IPO.

China’s large consumer market, rapid digital transformation, and its creativity are helping these entrepreneurs become the icons of a new generation in China and the United States. Investors should see their jobs as super-connectors, providing these entrepreneurs with capital, connections, and experience that helps their companies continue to grow and scale beyond China’s borders.

 

News Source = techcrunch.com

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