🚀 Is TikTok losing the hype?
🚀 Is TikTok losing the hype?
Plus, the maker of Pokemon GO releases an NBA game!
trending 📈
💊 Amazon launches RxPass. Two years after Amazon debuted its pharmacy, the company is getting more aggressive about acquiring patients. This week saw the launch of RxPass, a service for Prime members that offers generic medications for 80 conditions - for a flat fee of $5/month. RxPass works with cash pay, not insurance, leading experts to wonder how much it will cost Amazon to subsidize these discounts.
RxPass will likely compete with Walmart’s $4 prescription program, which has been around for decades but costs $4 (or more) for each generic medication - as well as Mark Cuban’s Cost Plus Drugs.
🤝 Microsoft & OpenAI expand partnership. AI is taking over tech, and Microsoft wants a piece of it! Microsoft first invested in OpenAI (the creator of ChatGPT and DALL-E) in 2019. Now, the companies are deepening their partnership. Microsoft will reportedly make a $10B investment into OpenAI and start to integrate OpenAI models into its existing products, and OpenAI will continue to run its tools exclusively on Microsoft’s Azure cloud platform.
🏀 Niantic gives sports a shot. Believe it or not, it’s been seven years since Pokemon GO’s debut. This week, parent company Niantic released its first sports title - NBA All World - which allows players to face off in 1v1 battles on digital courts. While Pokemon GO has maintained a strong user base, Niantic’s subsequent games (including Harry Potter: Wizards Unite) have struggled to find an audience. We’re excited to see if All World can recapture the original AR magic.
🚘 Tesla beats expectations. Tesla stock soared 30% this week after the company outperformed Q4 2022 revenue estimates. Tesla started a series of price cuts and discounts in October 2022, which lowered prices of some models by more than 20%. While this brought gross margins to the lowest level in the five quarters, it does seem to have boosted sales - Elon Musk said January 2023 represents the strongest month of demand in Tesla’s history.
Because this is technically a careers newsletter, we had to feature this early contender for Tweet of the Year. The Washington State Department of Natural Resources has consistently 🔥 tweets - check out more from them here.
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2023 Tech Weeks have been announced in SF, LA, and NYC - register here to get more info.
It’s been a little while since we’ve done a deep dive on TikTok - we decided it was time for an update! The ~vibes~ around the app seem to have shifted lately, and not for the better. We’ve heard from many early adopters that it feels like the magic is fading, and they’re spending less time on it than they used to. Meanwhile, latecomers to short form video are getting picked up by IG Reels and YouTube Shorts.
SensorTower data on monthly active users (MAUs) and downloads illustrate that TikTok has hit a plateau and is starting to slide. This isn’t unusual for a social app at scale. Over time, the novelty wears off, copycat products emerge, and the potential user base gets saturated. After an app peaks, it’s time for a second act - which some apps execute successfully, and others don’t.
We have a few ideas on potential directions that TikTok could take next:
Add long form, “lean back” content. Many Gen Zers and millennials spend hours a day listening to passive audio / video - think ASMR, podcasts, or lo-fi tracks - while working, doing homework, commuting, etc. TikTok captures none of this listening time today, as scrolling the feed requires active focus! However, TikTok creators are already making this content and directing their subscribers to YouTube to watch. Why shouldn’t TikTok host these videos itself + keep creators and viewers in the app for longer?
Double down on commerce. TikTok has a unique opportunity to become THE destination for mobile commerce, taking significant time and $ from traditional e-comm sites. It’s already used for product discovery and reviews - but if you want to actually buy an item, you have to leave TikTok. In-app purchases are in the works, and I think there’s a lot more to do here: livestream selling, social discounts, and aggregating videos into product pages are all low-hanging fruit.
Lean into photos. This one might sound crazy, but I think it’s not too far fetched! As Instagram doubles down on videos, it’s rapidly going downhill as a place to get eyeballs (and engagement) for your photos or other static content like memes. TikTok could fill the void, and is already seeing success with the IG-esque photo carousel feature that’s been gaining steam over the past few months. It’s worth noting that because TikTok hasn’t done a great job of recreating your social graph, the ideal photo content would likely be more interest or story-based.
The TikTok team iterates quickly given the scale of the company - Stories, Now (BeReal clone), AI Avatars, and Photo Mode are all new features in the past few months. We expect to see them test many more in the coming weeks / months, and we’re excited to see what sticks 👀
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internships 📝
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puppy of the week 🐶
Meet TeO, a 1.5-year-old Italian Greyhound who lives in Japan.
He enjoys chewing on pants, people-watching at the park, and wearing fancy outfits to keep warm.
Follow him on Instagram @itagure_teo_kobe!
All views are our own. None of the above should be taken as investment advice. See this page for important information.