Why Twitter Spiked 5% Today

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Shares of technology stocks were mostly flat to middling today, with the rocketing GoPro IPO standing out. Twitter, however, a company still down heavily from its earlier post-IPO highs, advanced 5 percent.

Why? Positive external forecasts. Evercore Group indicated that it thinks Twitter’s domestic user growth could best its first quarter tally, reassuring skittish investors worried that the social company didn’t have the mojo left to attract more eyeballs to its service.

In its report, Evercore said that Twitter could see 20 percent year-over-year growth in its domestic user base in the current quarter. Twitter and other social companies generally have an easier time extracting revenue from domestic customers. So Twitter’s local audience is likely a key driver of its revenue growth.

Twitter has performed well financially since its debut. Its share flew from its initial $26 pricing, cresting the $70 mark before retreating, eventually falling to around the $30 mark. In its two quarterly reports since its IPO, the company’s lackluster user growth figures have overshadowed quickly advancing revenue.

Twitter closed today at $41.44. Its recent recovery has been somewhat quiet, with the company steadily growing its market cap since the start of June. Provided that Twitter can prove that its days of audience growth are not behind it, investors could fall back in love with Twitter.

According to Google Finance, Twitter’s value ended regular trading at around $24.4 billion.

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http://techcrunch.com/2014/06/26/why-twitter-spiked-5-today/

Pirate Radio, YouTubers And Video Games

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Editor’s note: Tadhg Kelly writes a regular column about all things video game for TechCrunch. He is a games industry consultant, freelance designer and the creator of leading design blog What Games Are. You can follow him on Twitter here.

PewDiePie, TotalBiscuit, Vegetta Gaymer, TheDiamondMineCar, VanossGaming. These and many more represent the new frontier of gaming media. They are “YouTubers”, channels on YouTube that record lengthy (known as “Let’s Play”) gameplay videos and use them as footage for episodic, usually comedic, shows.

YouTubing (and similar through services like Twitch) has been gaining momentum for a while, but this year it seems to have broken through into the wider consciousness. Some channels have attained enormous followings and are starting to exert huge influence. Many indie developers report, for example, that YouTubing is far more successful in driving sales than the traditional PR/press machine. Many attribute the initial flocking of users of Flappy Bird to YouTubers. Lots of folks have heard that PewDiePie is monetizing his 28m viewers to the tune of $4m a year.

Often the videos that YouTubers broadcast are less about journaling and more about community. TotalBiscuit plays it relatively straight for instance, providing deadpan lengthy previews, reviews and commentary about games. On the other hand, Sky Does Minecraft is more play-for-laughs in nature, and it’s these latter kinds of channel that attract the largest viewership. Viewers like to really see what’s under the hood of a game, but they also like to laugh along with

The range of channels is also impressive. Many are made just for fun with no expectation of revenue of any kind. Some are more passion-projects devoted to certain aspects of games. For example, journalist Leigh Alexander produces a series called Lo-Fi Let’s Play, wherein she plays obscure emulated Apple II games lost to time. YouTubing is very hip, very community-Internet, but it raises some difficult questions.

The New New Games Journalism…

In an article on Gamasutra earlier this week, Mike Rose asked would YouTubing kill the games press, and while the general consensus seems to be “no”, the sentiment that it has become a key part of the landscape is undeniable.

The games press and the industry it covers have long had a complex relationship. Like all media reporting there’s a persistent tension between serving the audience versus the paymasters, and those waters are often muddy. Access is valuable, thus the need to preserve it. Top games draw major traffic and big publishers pay for advertising on those same sites. Yet readers expect sincerity, and those forces are often at odds.

So YouTubing could be characterized as the citizen journalism of gaming. Many YouTuber videos feel very raw compared to the canned essays that more official organizations create, and this sort of quasi-legitimate voice connects with millions of viewers because it acts and sounds like they do. This makes a variety of game makers pretty unhappy.

The perception of many developers is that YouTubing is not really journalism, but rather pirate radio. In this vein the game is seen as content, and thus the idea that someone out there is re-broadcasting that content for laughs, and making lots of money from doing that, is wrong.  Support for this position (or something approaching it) is pretty broad in the industry.

One reason why is the sense that too much honesty is bad for business. For example many developers feel like they shouldn’t release demos for their games. The data tends to indicate that free levels or content cut potential sales in half because once players have seen the first few minutes of the game and scratched that itch, there’s no reason to buy. On the other hand games that feature sexy trailers but no demo sell very well: to scratch the itch the customer buys.

So the relationship that games have had with video has long been about being showy without, if you’ll pardon the pun, giving the game away. From small indies through to major publishers, everyone tacitly understands that stoking the desire of sales is often best done by keeping the audience at one remove from the product, and the more cynically minded tend to think that everything that happens post-purchase is the buyer’s problem. Therefore they fear overexposure.

Whose Game Is It?

Another reason is the perception of content ownership. Well-known indie developer Phil Fish tweeted that he believed YouTubers should be paying him for using his content. Nintendo went several steps further, first with legal injunctions and then the establishment of an affiliate program. Of course this perception is not universal, but it is curious how many game makers (and some fans) have this “broadcast” view of their work. They see it much as Metallica saw Napster et al in the 90s, and especially so the more successful they become. They essentially say “I made the content you’re using to make your show. Pay me.”

When I asked on Twitter for some views on the issue, a game designer named Jeff Atomreplied:

if you assume that a game is made up of 3 components. Artwork, story, and interactivity, let’s plays have taken 2/3 of the game.

But here’s thing with that: Hasbro may sell you a copy of Monopoly and own the rights to it, but do they own the rights to you filming a session of Monopoly played with your friends? That’s a stretch. We don’t see board game makers claiming that Will Wheaton’s Tabletop show pay them for featuring their games, even though those shows can be very long and spoilerific. A 2.5 hour recorded session of Lords of Waterdeep isn’t “stealing it” to “make money from our work” through YouTube advertising. It’s covering, and therefore promoting, it.

Paraphrasing what the Supreme Court said the other day in relation to patents, just because it’s on computer doesn’t mean that video games are different. A digital game is just as much a set of play pieces and rules as a board game or tabletop roleplaying game is. A play session of Phil Fish’s Fez is not Fez much as a play session of Magic: The Gathering is not Magic: The Gathering. This is where the analogy of pirate radio breaks down.

Mojang may own Minecraft, for example, but it would be hard pressed to claim that it owns all of the expressions of work made in Minecraft. Rockstar may own Grand Theft Auto 5, but it’s harder to claim with a straight face that it owns VanossGaming’s GTA 5 Funny Momentsseries. That would be like Microsoft claiming ownership of all Word documents. The fact that you’re viewing someone’s play of the game is not necessarily derivative. It could be construed as satire, for example, which enjoys special protection in most countries. It could even be construed as wholly creative work in some cases.

Yes Play, No Play

It could be a function of unfamiliarity with YouTubers that leads publishers to fear the new and the strange, and in some cases it could be short-sighted greediness that makes a developer think he’s owed money from having his game covered, but it feels like more than that. Perhaps it’s about respect.

The same game makers who feel a bit weird about YouTubers are generally very happy when gaming site Giant Bomb posts a “quick look” of their game. What’s a quick look? A 20/30 minute length preview of the game complete with humorous commentary and side-conversations, just as is seen with many YouTubers. The difference is that the tone of the coverage is usually more favorable, less about poking fun.

Developers like Fish are at least half-right. While it’s a bit of a stretch to try to tap as a source of revenue, it is true that much of YouTubing’s success is based on a liberal reading of intellectual property ownership combined with lax enforcement. At the very least devs should have some way to choose to opt-out of being YouTubed and not having their game spoiled. From a legal perspective the middle path seems to have much to do with sensible licensing.

Jas Purewal, a well-known video game lawyer and blogger, says this:

As it happens, I wrote a guide to Let’s Play and the law here. It’s drafted mainly for Let’s Players and only tangentially addresses the question of game developers’ stance on monetisation. It’s quite simple: if you want to support Let’s Play videos, use some simple (but legal) wording on your site. If you don’t want to have Let’s Play videos of your games, then have wording that says that instead. If you want to prohibit Let’s Plays temporarily (e.g. while a game is in closed beta) or if you want to have Let’s Plays only if the Let’s Player contacts you first to discuss terms, that’s OK too.

Clearly though there might be questions about what those different kinds of words should say, so in the next couple of months I’ll prepare and release under Creative Commons some simple wording that devs can use for each kind of situation. I hope that will help.

Mayhap. It certainly seems as though a boilerplate license, one that’s quickly referable by YouTubers and easily implemented by developers, would help. That way if the Phil Fish’s of this world didn’t want their game covered then they can say so easily. Combined with technologies like YouTube’s Content ID, hopefully a good middle course can be struck between the needs of the YouTuber audience to see the whole game and that of the developer to craft a package, leaving almost everyone happy.

Beyond The Fun

In looking at Let’s Play I’m moved to wonder whether we’ll soon see Let’s Learn, Let’s Tech, Let’s Read, Let’s Write and numerous other styles of community shows emerge. I also wonder whether we’ll start to see existing media, or even publishers, attempt to get in on the action by creating their own YouTuber channels. Whatever your take, there’s no denying that the YouTubers have opened the door to something very big. Right now they may be operating by the seat of their collective pants but they’re sitting on top of a massive asset. The prospects for what it might do are grand indeed.

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http://techcrunch.com/2014/06/22/youtubers-are-a-thing/

The Five Tough Truths Of Cybersecurity Software

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Editor’s note: Ted Schlein is a general partner with Kleiner Perkins Caufield & Byers. Earlier in his career, he brought to market the first anti-virus software for commercial use at Symantec and also served as the founding CEO of Fortify software, now an HP company. 

Building a successful security software company is notoriously hard to get right over the long haul. Computer security is a fast-moving target. You still need anti-virus software, for instance, but it won’t necessarily keep you safe. The same is true for firewalls, and malware detection, and spam blockers, and various other security measures. For better or worse, there is never-ending opportunity here, as the good guys race to keep up with the bad guys.

The tricky part is that over time the bad guys have gotten smarter and the threats more ominous. The stakes keep ratcheting higher. Thirty years ago, we were dealing with amateurs. Now the bad actors are international organized crime groups and nation-states. In the old days, the issues were tactical. Now they’re fundamental. This isn’t just an IT issue: Target recently fired its CEO after the retailer suffered a massive security breach. Careers, as well as data, are at risk.

I’ve been spending a lot of time (and money) funding new security companies in recent years, and I’ve worked in the industry myself. Along the way, I’ve reached some conclusions on how to improve your odds of success. Here is my list of five truths about the cybersecurity business:

1. There are two types of companies: those that know they’ve been breached, and those that haven’t figured it out yet.  

The security software entrepreneur Kevin Mandia founded Mandiant*  — recently sold toFireEye for $1 billion — on the thesis that no one can really stop the bad guys from entering your network. The game is no longer about prevention; it’s about detection. The average length of time it takes for an advanced persistent threat to be detected on a corporate network is now an alarming 229 days. We need to get that down to 24 hours — or one hour.

Companies need early-warning systems to know they’ve been breached, but they also need the context around that intruder, including what data has been compromised and by whom, and a system to contain and fix the issue as fast as possible. Simply manning the barricades is not enough. Evildoers are going to come over the walls, under the walls, around the walls and right through the front door. You need to discover them, find out what they’re doing and stop them, and you need to do it as quickly as possible. Software from Rapid 7 and IBM’S Qradarsecurity platform focuses on identifying behavioral anomalies in real-time.

The scary truth is that network security does not work as well as we thought. That’s what leads to the fight for the endpoint — how people protect endpoints will be completely different than over the last two or three decades. Bromium attacks the problem by focusing on data protection, rather than intrusion detection. They create a secure, isolated container for each task a user performs on an untrusted network or document –- preventing malware from spreading. Invincea, likewise creates a “secure virtual container” to wall off the most vulnerable applications, like browsers, PDF readers and Office.

2. Corporate networks are like M&M’s: hard outside, soft inside.

Companies need to toughen up from the inside out. (Think peanut M&M’s.) Sure, you need to fight off malware and viruses, and you want complex passwords and stiff security regimes. But you still won’t keep everyone out. Rather than simply erecting thicker walls to fend off intruders, which becomes increasingly impractical in highly distributed cloud-based architectures, we need to encrypt the data that attackers want.

Evildoers are going to come over the walls, under the walls, around the walls and right through the front door.

You need to encrypt data all the way to the browser, and the browser itself has to be 100 percent authenticated. But you have to hide the complexity. The whole thing needs to be seamless. As an end user, you’re not going to tolerate having to mess around with encryption keys and other complications. Companies like Ionic Security* are working on solving this end-to-end encryption problem. If it works, hackers will face a new challenge: they can steal the data, but they won’t be able to read it.

3. Threats are getting more dangerous, with higher risk of catastrophe…

The ramifications of security breaches are getting worse. Two decades ago, a breach was mostly an operational problem that might cost you money and time. Today, a breach is a strategic issue that could ruin your business and put your customers’ finances at risk.

4. …so we need new weapons.

Global 2000 companies face an ominous issue: They can’t scale fast enough to meet growing threats. They can’t hire enough people or buy enough technology to be totally secure – they need to go outside to get help. The stage is set for companies taking new approaches to this issue.

Shape Security* has created an approach it calls “shape shifting” to beat hackers by turning the tables and going after the bad actors with the same kind of attacks they use on the good guys. Shape’s realization: while you can’t prevent a bot from landing on your network, you can prevent it from being effective. Splunk uses crowdsourcing techniques to keep track of threats and consider potential remedies. Rather than buy a threat feed, you get it from the universe. It’s the closest you’ll get to real-time threat detection.

Synack* takes a sort of ‘Super Friends’ approach, teaming the world’s greatest white hat hackers and applying them to your company’s security risk assessment with an automated platform. While few companies could ever afford to get that talent inside, the approach here is to let you rent them.

5. If you can’t beat ‘em (and you can’t), deter them.

The bottom line is that evildoers are going to get on to your network, and when they do, they’re going to cause troubles that will sometimes pose catastrophic risk. But there’s no need to panic; it’s a matter of preparation and staying vigilant when the invaders land inside the wall. Innovation in the security space is high. But there’s a lot of creativity being applied on the other side, as well. The good news for entrepreneurs is, this is going to be a never-ending battle.

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http://techcrunch.com/2014/05/31/the-five-tough-truths-of-cybersecurity-software/