A History of Silicon Valley

Table of Contents | Timeline of Silicon Valley | A photographic tour
History pages | Editor | Correspondence
Purchase the book

These are excerpts from Piero Scaruffi's book
"A History of Silicon Valley"


(Copyright © 2016 Piero Scaruffi)

The Selfies (2011-16)

click here for the other sections of this chapter

The Age of the Smartphone App

The importance of the "app store" was skyrocketing by the day, just like the availability of applications had favored Windows on the desktop, except that this time around Microsoft was on the losing end. In 2013 Microsoft announced the acquisition of Nokia's mobile business within two years the two companies introduced state-of-the-art smartphones such as the Nokia Lumia 1020, equipped with a camera worthy of professional digital cameras, and the Nokia Icon, whose user interface was as advanced (if not more advanced) than the Android's and the iPhone's ones. Unfortunately, Nokia's smartphones were running Windows Phone, and Windows still did not have the same apps available to Android and iPhone. No matter how technologically advanced, Nokia's smartphones were doomed to be outsiders.

In 2013 worldwide sales of smartphones passed the one billion mark, posting a 38.4% increase from the previous year, with Samsung accounting for 31.3% of the units, followed by Apple with 15.3%.

While apps continue to proliferate in all possible fields, the biggest success stories had to do with extending the social network enabled by smartphones.

Tencent had been founded in China in 1998 by Ma Huateng and Zhang Zhidong to develop the PC-based instant messaging platform Open ICQ or QQ. In 2009 the Chinese government had blocked access to Facebook, and soon Twitter and Youtube were banned too (as well as millions of other websites including www.scaruffi.com ). In January 2011 Tencent released the social networking platform Weixin/Wechat, designed by Allen Zhang, which simply integrated the features of all those social networking platforms, and also provided a sort of digital walkie-talkie (verbal instant messaging, very popular in a nation whose complex language is not friendly to texting). Within three years it had 300 million users, growing faster than Facebook.

Tango, founded in 2009 in Mountain View by Eric Setton and Israeli serial entrepreneur Uri Raz, provided a voice and video messaging mobile platform for all smartphones, competing with Apple's proprietary Facetime. The app went viral so quickly that Tango already had one million users after just ten days of launching (Tango later added entertainment, gaming and ecommerce and became a "unicorn" after Alibaba invested in it in 2014).

Snapchat was started by Stanford students Reggie Brown and Evan Spiegel in 2011 for smartphone users to share photos and videos.

In the age when the public was increasingly concerned about privacy, Snapchat pledged to delete every messages from its servers within a few seconds.

This was, after all, the age of the "selfie", the self-portrait photograph posted on social media for all your friends to see how cute and cool you are.

WhatsApp and Snapchat (and WeChat in China) competed for the same market, but were fundamentally different business models. WhatsApp allowed users to send and receive texts, voice, pictures, audio and video. WhatsApp charged a tiny yearly subscription to its users. WhatsApp was only available on phones, not on computers. WhatsApp served a wide range of age groups. WhatsApp had no advertisements. Snapchat was also available on Apple and Android devices. Snapchat had some advertisement but was absolutely free. Snapchat deleted from the memory of the device videos and photos within 10 seconds of sending them. Snapachat was the perfect tool for "selfie" maniacs and therefore had an audience mainly of young people.

The mid-2010s were the years of the messaging bubble: in 2017 apps for messaging and chatting enjoyed a collective valuation of hundreds of billions of dollars. In 2014 WhatsApp had 55 employees when Facebook acquired it for $19 billion. In 2016 the biggest tech IPO was a messaging app: Line. Snap (previously called Snapchat) lost half a billion dollars in 2016 but it was worth over $30 billion in 2017.

The company that had perhaps the biggest trouble adjusting to the new world was Yahoo! In 2012 it hired Marissa Mayer from Google, the rare case of a major CEO coming from the ranks and files of a high-tech company. She launched into an acquisition spree of her own, purchasing 16 startups in her first year at the helm of the company. The biggest purchase (2013) was blogging platform Tumblr, founded in New York in 2007 by Marco Arment and David Karp (who was barely 20). This was not the first attempt by Yahoo! to enter the blogging sphere. Yahoo! had already purchased the most famous blogging site of 1999, Geocities, only to cause its rapid demise. Just like then, Yahoo! was more interested in Tumblr's customer base of 105 million bloggers than in contributing to progress in this technology. And, just like in the age of Geocities, it was still not clear how these platforms were supposed to make money. Most of the other acquisitions were for mobile applications and services, like the gaming platform PlayerScale and the video platform Qwiki. Among them was London-based "whiz kid" Nick D'Aloisio's news aggregator Summly (originally called Trimit and developed for iOS in 2011, when he was still 15), based on Artificial Intelligence software coming from SRI International. Just like with Google, this was also a way to hire top software engineers (the so-called "acqui-hire" method).

The mother of all applications was the "personal assistant", or, better, the voice-controlled contextual search tool. Apple had introduced Siri with the iPhone 4S of 2011 after merging a personal-assistant technology acquired from Siri with the speech-recognition technology acquired from Nuance. During the year 2012 Apple's Siri was joined by a number of tough competitors: Samsung's S-Voice, launched in May 2012 for its Galaxy S3 smartphone; LG Quick Voice, launched in June 2012 for its Optimus Vu smartphone, and, last but not least, GoogleNow, launched in July 2012 on Samsung's Galaxy Nexus smartphone. In 2014 Amazon released Alexa, created by the same Amazon Lab126 in Sunnyvale that had made the Kindle. Microsoft followed suit in 2014 with its Cortana. In 2014 Apple's iOs8 introduced the "Hey Siri" feature that enabled any app to summon Siri; and in 2015 Uber introduced a similar feature to summon Uber from any other app.

The new generation of intelligent assistants included Kasisto (2013), an SRI International spin-off just like Siri, and Digital Genius, designed by London-based Russian-born Dmitry Aksenov, as well as some specializing in scheduling meetings, such as Clara (2013), founded by Maran Nelson and Michael Akilian in San Francisco, and X.ai (2014), founded by Dennis Mortensen in New York. In 2015 Facebook launched its own virtual assistant, M.

However, these "assistants" were still a far cry from a real "contextual and predictive technology".

Social apps for the mobile world continued to multiply. Flipagram, founded in 2013 in Los Angeles (by Raffi Baghoomian, Brian C. Dilley, Joshua Feldman, Farhad Mohit), and funded by Michael Moritz and John Doerr (who famously invested together in Google), offered an app that allowed users to quickly produce short video clips combining photos, videos, text and music. In 2014 Fyusion, founded in 2013 in San Francisco by Willow Garage alumni Radu Rusu, Stefan Holzer and Stephen Miller, debuted the mobile photo app Fyuse that pushed social media beyond panoramic snapshots and towards immersive 3D photography.

The age of the selfie quickly turned into the age of the short video. Snapchat passed 6 billion daily video views in 2015, just three years after the introduction of its video service. By then Facebook boasted 8 billion daily video views. In 2015 Google acquired Fly Labs, founded by Tim Novikoff in 2012 in New York, creator of immensely popular video-editing apps for the iPhone. Cinematique, founded by Randy Ross in 2012 in New York, provided a platform for making interactive online videos. In 2014 Shutterstock, an online marketplace for trading stock images launched in 2003 in New York by Jon Oringer, debuted an in-browser video-editing tool, Sequence. In 2016 Moviefone's founder Andrew Jarecki launched a video editing app for the iOS, KnowMe. Bitmovin, founded in 2013 in Palo Alto by one of the DASH creators, Christian Timmerer of the Alpen-Adria Universitaet Klagenfurt in Austria, delivered high-performance MPEG-DASH players for HTML5 and Flash on smartphones as well as computers.

New creative kinds of collaboration tools were introduced in the 2010s, notably: TinySpeck (later renamed Slack), founded in 2013 in San Francisco by Stewart Butterfield of Flickr fame with Serguei Mourachov, Eric Costello and Cal Henderson; and HipChat, founded in 2010 in San Francisco by Chris Rivers, Garret Heaton and Pete Curley, and acquired by Australian company Atlassian in 2012. Slack was tapping into a transformation of the main decades-old form of interpersonal digital communication: email. Email had been attacked on one side by chat applications, that provided a much simpler way to carry out instant bidirectional communication than traditional email. Email itself had become less of a person-to-person communication tool and more of a machine-to-person communicaton tool and a campaign-to-the-masses communication tool, as many emails were generated by machines (not only marketing but also receipts, social-media notifications, bank statements, etc) and many emails were crafted for an audience by a Mailchimp user (Mailchimp having become the main email marketing platform, originally founded in 2001 in Georgia by Ben Chestnut). Google too had contributed in giving email a bad reputation among younger people by unnecessarily overloading Gmail (the most popular email application) with features and icons that sounded confusing, complicated and old-fashioned to kids used to one-click communications. Slack was one of the tools that became popular because, indirectly, reduced email communications (in this case within a group).

In 2013 Quip (founded in San Francisco by former Facebook technologist Bret Taylor and by former Google engineer Kevin Gibbs) launched a mobile office application.

In 2013 Opera's cofounder John von Tetzchner founded Vivaldi Technologies to develop a new Chromium-based browser for power users.

The dark side of the Internet came to light in 2011, when a researcher discovered that spyware developed by Carrier IQ (a company founded as Core Mobility in 2005 in Sunnyvale by former Apple engineer Konstantin Othmer) was recording detailed user behavior on smartphones sold by AT&T, Sprint, T-Mobile, Apple and Samsung, which accounted for the majority (only two major manufacturers, Nokia and Research in Motion, never used this spyware). This followed a 2010 lawsuit, in which Skyhook Wireless sued Google for patent infringement, that indirectly revealed to the public a vast and secret three-year project by Google (from 2007 until the lawsuit) to collect WiFi signals using StreetView vehicles (hence renamed "Wi-Spy vehicles" by the hacker community). Skyhook Wireless, founded by Ted Morgan in 2003 in Boston, had become the world leader in "location intelligence", i.e. the leading source of information about Wi-Fi locations. That information provides a more accurate and battery-friendly way to pinpoint a mobile user's location than GPS or cell tower triangulation, the user's location being in turn very valuable for advertisers and therefore meaning big money for search engines. Google had a vested interest in improving its knowledge and tracking of the exact location at any time of users of Android smartphones. Skyhook was candidly admitting on its website that "Wi-Fi is far more than a network connection - it's a location source." In other words, Wi-Fi had become a way to track where a mobile user was.

In 1975 the FBI had funded the development of fingerprint scanners but it took decades for the technology to reach the consumer market. In 2011 Motorola became the first company to offer a fingerprint scanner in a smartphone (its Atrix). The fingerprint scanner used by Motorola in Atrix 4G was made by Authentec, which was acquired by Apple in 2012. Sure enough in 2013 Apple added a fingerprint scanner to the iPhone. A few months later HTC used the technology developed since 2010 by Validity (founded in 2000 in San Jose and acquired by Synaptics in 2013) for its One Max. China's Xiaomi introduced its fingerprint scanner in 2015.

In 1975 the FBI had funded the development of fingerprint scanners but it took decades for the technology to reach the consumer market. In 2011 Motorola became the first company to offer a fingerprint scanner in a smartphone (its Atrix). The fingerprint scanner used by Motorola in Atrix 4G was made by Authentec, which was acquired by Apple in 2012. Sure enough in 2013 Apple added a fingerprint scanner to the iPhone. A few months later HTC used the technology developed since 2010 by Validity (founded in 2000 in San Jose and acquired by Synaptics in 2013) for its One Max. China's Xiaomi introduced its fingerprint scanner in 2015.


click here for the other sections of the chapter "The Selfies (2011-16)"
(Copyright © 2016 Piero Scaruffi)

Table of Contents | Timeline of Silicon Valley | A photographic tour | History pages | Editor | Correspondence