Sander Saar, founder of AgentCDN, making videos work inside AI

Transcript

1. 0:00

   Hi, I'm Sander. And today I'm really excited to unpack with you the new era for audio growth. Look at the learnings from Clubhouse and also Facebook's plans to dominate. Let's dive right in. Facebook in 2015 and all of their conferences showed a chart where they're moving from text to photos, to videos, to VR and AR, but they actually left out one little part, which they really tried in 2011, which was audio.

2. 0:25

   In 2011, Facebook launched Facebook Live Audio, which was very similar to Clubhouse, which allowed anyone to launch audio rooms and also invite people into their audio streams, which was mainly built for radio stations and other Facebook pages to bring live audio experiences. Facebook also collaborated with Spotify to launch a music dashboard so that within Facebook you were seeing what your friends are listening to, but also Facebook Sociograph was embedded into Spotify so that within Spotify you can see what your friends are listening to, a way to discover and consume music.

3. 0:58

   In 2020, however, Clubhouse came around and everybody was like, hey, this is a new great audio format. But it was just not the right timing for Facebook Live Audio. Clubhouse, which is a drop-in audio chat where everybody can join any chat that is publicly available either as a listener and then if they're invited up to also take part in the conversation. So Clubhouse has been super successful. They've grown from 1,500 users to 10 million users in February in 2020.

4. 1:26

   That's just in less than a year. They're now doing doing more than 10, almost 10 million downloads in February and have amassed lots of press coverage and interest all around the world. So what's driving Clubhouse growth? Why Clubhouse works but Facebook Live audio did not work, for example. Number 1 is the behavior shift. There's a pandemic out there. Number 2 is the technology that's available out there, mainly around wireless audio devices.

5. 1:52

   And number 3 is the platform innovation that Clubhouse managed to do. So let's dive into each one of them one by one. Number 1 is the behavior shift in pandemic. On average, Americans spend around almost 50 minutes commuting to work, and now they have more spare time because most people are working from home, or at least spend more, more time at home while they're not commuting. It's something that also you can do while you're multitasking. So when people are cleaning, cooking when they're at home, audio is something that you can just plug in and continue doing whatever you were doing before.

6. 2:23

   And also you don't have to look good, so you don't have to be on a camera and also look good for the video because there is no video. The second area what's driving the growth, as we mentioned, is technology and AirPods. AirPods have now reached mass market appeal. They're selling more than 100 million units in 2020 based on the best estimates, which would make them bigger business than, for example, Uber or Airbnb just on their own as part of Apple.

7. 2:50

   But of course, AirPods themselves are a big unlock but doesn't take up all of the market. They're about a third of the market share of wireless headphones. Xiaomi, Samsung, Jabra, and JBL following behind it, and many, many other brands. It's a saturated market. And if you look at shipments of wearable computers or wearables overall, then earwear, meaning all of the things that go in your ear, mostly audio products, are the biggest share, even bigger than smartwatches, for example.

8. 3:17

   So it's a huge market and technology unlock and penetration that's out there. And number 3 is the innovation, the novelty of live audio. And there are 3 things that Clubhouse did differently. Number 1 is the serendipity. So you can drop into any room and you don't know what they're chatting about. So there's a little bit of a FOMO that you want to be part of that conversation, but also serendipity that you may end up being maybe meeting really interesting people and talking about really interesting things that you're into.

9. 3:43

   Number 2 is authenticity, meaning that there is no recording. So you can feel like you're on a phone call and casually speak about all the things that come to your mind based on what's discussed in the room. And number 3 is that it's exclusive. It's limited to only people who are already using the app who can invite other people. Even after they launched, in addition to the iOS version, also the Android version, they kept the invite-only structure, which sparked the growth of Facebook early on and is really driving the growth for Clubhouse as well.

10. 4:12

    But when you think about it, I think about Clubhouse much more like a format. It's something that they created and popularized, but it wasn't, that would not necessarily be the one that they're gonna own. So think about Snapchat. They brought out and really popularized vertical stories, those disappearing stories that you can send to your friends or you can publish to anybody who's following you. It was quickly followed by Instagram, Facebook Messenger, WhatsApp with their stories around 2016, a version of their, their stories format.

11. 4:42

    And of course now more recently Twitter launching Fleets and Instagram launching Stories and even someone like Slack launching their own stories version. But I think they all have a space in their own, own right. Of course, TikTok, same way, popularized those short-form video on mobile devices, and quickly Snapchat copied with their Spotlight, Instagram Reels, YouTube Shorts, and even Netflix launched movie premieres and fast loss.

12. 5:09

    So I would think about Clubhouse much more as a format that can be adopted on many platforms, and that's exactly what's been happening over the last year when everybody else has been seeing their user growth getting to 10 million users. And more recently, Spotify acquired Locker Room, which is a sports-focused, mostly basketball-focused audio chat for getting to know other fans pregame, during the game, postgame, and oftentimes also being able to listen in with conversations with players.

13. 5:37

    Twitter more recently launched Spaces, which is Twitter's own version of Clubhouse using the network graph of Twitter, where you can create rooms and join rooms using live audio feature. LinkedIn themselves has shown graphs out there or screenshots out there that they're launching live audio, and many other community apps like Telegram, Reddit, Discord, and Slack are launching their own audio versions. And I think they all have a place for it.

14. 6:02

    For example, Locker with Spotify could be very interesting for sports, music, and culture communities to gather and talk about just in that new live audio rooms format. I think Twitter Spaces can be great for news discussions, and LinkedIn can be interesting for business discussion or your professional network, as well as Telegram for, with their private groups for all of your crypto talk, as well as Reddit with its public discussions, as well as Discord for its own communities that live on these platforms, and Slack, who's also experimenting it for work environments.

15. 6:32

    So they just all have different uses for different communities, but the format remains the same. Not to even talk about many, many competitors that have come to the market who are trying to exactly replicate what what Clubhouse is doing, but for different communities, again, trying to differentiate through that. And those apps themselves are actually seeing a lot of positive feedback from users. So Clubhouse rating themselves in the App Store is 4.8, while many of the apps are not lagging too far behind and still be able to deliver a really good experience that users love just in their own right.

16. 7:04

    Some of them are real, some of them are made for fun, but I'm sure there will be many more in addition to Clubhouse. But what's Facebook's plan? A bigger plan to conquer audio than just live audio rooms. They're looking at podcasts, they're looking at soundbites, and they're looking at music. And in addition to all of that, also building creation tools for all of these to bring a studio in your pocket. So another way to think about it, they're putting together kind of Clubhouse audio rooms together with Apple Podcasts, which has been one of the most popular podcast platforms, Soundbites, which is the Twitter version, kind of the Twitter audio tweets that they launched last year, music that Spotify is offering, and something like Anchor, which makes it super easy for anybody to record audio content on their phone.

17. 7:50

    Let's dig into each of those areas and see why they're relevant for Facebook and how you could learn from that to leverage them for your own growth. Number 1 is live audio rooms. Mark Zuckerberg sees it exactly the same way, that every once in a while there is a medium that comes along that can be adapted to many, many communities and groups. And Facebook is a place for communities and groups to gather. Facebook has more than 1.8 billion out of its 2.8 billion users who are part of a group.

18. 8:17

    That's their monthly active users. And they have more than 70 million people who are admins on the platforms. And more of, more than half of the group's users belong to more than 5 groups. So groups in itself, I think, is the biggest opportunity for live audio. So in addition to having photos and videos, which is a very one-way conversation through the comments. You can only feed back to that, but you don't really have a true dialogue and relationship building. And all live audio can definitely be that for Facebook and build more meaningful relationships within the groups that you're already part of.

19. 8:48

    Not to mention, of course, Messenger with 1.3 billion monthly active users, which is a great opportunity for live audio rooms as well. But moreover, more importantly for Facebook, they want to get rid of that infinite scroll of feed and have something that people can also consume in the background and something that will keep users longer in the app. And Facebook Groups as well as Messenger is an amazing way to do that. And you could imagine a day where Facebook and Messenger will have their own apps available in your car that you're listening to while you're driving, or you're listening to it while you're walking, because those live audio conversations that are happening in Facebook Groups and Messenger, so this can become really a new platform for Facebook to expand beyond the platforms that they're currently on, including cars.

20. 9:33

    And of course, Facebook has seen already some success, and they've seen that, they haven't announced any numbers, but they've seen a lot of success with their live video rooms, which has been available to groups as well as Messenger more recently. So I'm sure they're seeing some success there and seeing that audio can even expand it further. Now let's talk about podcasts. Mark Zuckerberg says that there are already 170 million people on Facebook that are connected to a page and that is talking about a podcast.

21. 10:01

    So they see that this is a great opportunity for Facebook to help those people discover and consume more on the platform because the target audience is already 170 million that they can tap into. Podcasts themselves is actually more interesting for Facebook for many reasons. Number one is the ad spend based on eMarketer for podcasts is about to raise to $1.8 billion just in the US in 2024, and I'm sure Facebook wants to have its fair share of that.

22. 10:27

    And also the number of podcast listeners has been incrementally growing every year and is about to reach 120 million users by 2022 in the US. And globally those numbers of course are much bigger, but those are mainly the 2 reasons, is the consumption side as well as there is a lot of money to be made on the advertising side, which Facebook is really good at. Now what they're doing in podcasts are 2 things. They're mainly focusing on the creator, a way to share podcasts directly on on the platform so that it can also be consumed on the platform.

23. 10:58

    And also a way for creators to grow and connect with their listeners on the platform. And for listeners, for consumers, users of the platform, it's a way to discover. Discovery for podcasts is very difficult than most other podcast consumption devices or platforms which are just like RSS feed readers versus having a social experience around it. So it's a great way for listeners to consume, discuss, share, and get updates from their favorite podcasts.

24. 11:24

    Soundbites. That's more of the novel idea of all of the, in the Facebook stack, and that's a short-form audio format that they're releasing for the platform. They're envisioning this to be a place for anecdotes, jokes, moments of inspiration, poems, and they're also announcing a creator fund to see what creators will come up with and what they're able to do on the platform. I think this is interesting, and this can really build upon something that Twitter already built last year on Twitter Audio Tweets, where they've forgot to think about accessibility.

25. 11:56

    And Facebook in these screenshots is already showing off that you can also see the speech-to-text so that people from any background and with, with any disabilities can see and consume and be part of that Soundbites experience. So I think this can be an interesting product and definitely would work well for inspiration and comedy. Soundbites is interesting because it's already some of the larger consumption factor for podcasts. If you look at Joe Rogan when he was still publishing his main podcast on YouTube, his clips channel in August 2020 was driving 70% more views than his main podcast channel.

26. 12:32

    And for someone like H3 Podcast, even the last month, he's driving almost half of its views from the highlights channel. So even podcast highlights themselves can be a huge product, an important product for Facebook, and Soundbites is a great way to exploit that. Number 4 area in this Facebook strategy to win in audio is the music, what they call Project Boombox. A mini player experience that lives within Facebook that's already out there today where you can listen to songs in full.

27. 13:02

    You can share songs and podcasts from Spotify directly to Facebook and you can play them straight away and you can keep listening to them while you're scrolling. And they've also expanded from 15 to 30 seconds to share music and podcast clips to Stories. It's interesting to see how they're going to balance out having their own podcast product in the market with Spotify also sharing podcasts within the feed and being able to play them in the background.

28. 13:27

    So you can see how Facebook as an audio player is definitely opening up to others as well. Facebook is also building something that underlines all of that, and they focus very much on creator tools. Creator tools are mostly helping creators to more easily and more seamlessly create audio content on the go. They have things like audio green screens, so you can be anywhere but change your background noise to sound like you're on the beach or sound like you're in a studio.

29. 13:53

    They got voice morphing for changing what you sound like. They got different sound effects so you can use your outro, intro music, etc., or clapping. They also have great tools for removing noise. They got impressive sample that I want to show you as well. They also have a way to technologically make your, make your phone mic and your headphone mic sound much better than it is using machine learning. And they in addition have speech-to-text capability for all of those platforms, making it easily searchable and accessible for anybody.

30. 14:21

    Let's listen to one example that I think is very impressive that they announced and showed around.

31. 14:27

    So I'm testing out a bunch of new audio stuff that Facebook's building, like smart noise reduction. So you won't hear any of this street noise when I play it back.

32. 14:34

    And what, it'll just like disappear?

33. 14:36

    Yeah, it's like camera filters but for audio. So you can edit and you can add effects and all that stuff right from your phone. Yeah, well, what do you want to hear?

34. 14:45

    How about, you know, could you make me sound like a chipmunk?

35. 14:49

    Okay, perfect. Yeah.

36. 14:51

    Or like, you know, one of those walkie-talkie things. Or I don't know, maybe a robot. Or maybe some ASMR to put me to sleep.

37. 15:01

    Love it. Okay, so we just listened to the playback. What do you think?

38. 15:05

    I mean, that's crazy. It's basically like a sound studio right in your pocket. This is very impressive what they've been able to achieve with technology built by Facebook and how they could also differentiate rather than just copying those things. I think the Studio can truly be a differentiator. What are some of the challenges? What we should keep in mind when we get excited about the new era for audio and the growth opportunities out there.

39. 15:30

    Number 1 is adoption. Is it just a novelty in some ways and it's just gonna phase out soon? Number 2 is moderation and safety for users. Clubhouse is saying there, there, it's very authentic where the conversations are not recording, but actually they are recorded even by Clubhouse themselves. That has caused some controversy. But solely for the purpose of supporting incident investigations, which I think is, is fair.

40. 15:55

    On the second side, the tough part is global safety across languages. Of course, it's much easier to do that in English, but it's much harder to do that when people are mixing languages in the same conversation or having conversations in many different languages. And number 3 in safety is catching those abuse and bad behavior before it happens. Facebook says they've got a lot of experience in that through Facebook Lives, even though there's been many, many murders that have been publicly live on Facebook, but they're saying they got much better tools to catch all of those now.

41. 16:27

    The third area for challenges is around monetization, how the creators would get paid through either paid content and channels, through tipping, ads, creator funds. And there's a whole lot happening in that area that we're gonna dig into in the coming videos. But the novelty factor, something that I did not show you, is that yes, Clubhouse got its 10 million users, but it dropped quickly down from 9 million downloads in February to under a million downloads in April.

42. 16:55

    And the search volume for Clubhouse has completely dropped in that time as well. So this is very interesting to see whether Clubhouse themselves is just going to be a novelty like Meerkat was a while back. Meerkat launched, Twitter had actually already acquired Periscope before that, a similar live video platform. To stream to your network. So Twitter very quickly cut Meerkat off its platform. Facebook just a couple of months later launched Facebook Live, and about 10 months later YouTube launched their own Live so you could go live straight from your mobile device.

43. 17:28

    And a little more than a year and a half later, Meerkat shut down, which became Houseparty, which is a very successful product now by Epic. But still, it wasn't a platform that worked out. Is Clubhouse at risk of becoming something like Meerkat? That will be copied by other platforms and just shut down after that. Of course, video went on to become, live video to become a successful platform. There's many, many out there that continually grow.

44. 17:53

    Or has it more like an opportunity to become Snapchat? Of course, just 5 years later, Instagram launched Stories, WhatsApp, Facebook Stories, YouTube Stories, etc. But WhatsApp kept strong. Yes, it wasn't as relevant as Instagram Stories are reaching more than 500 million users, and Snapchat has got around 260 million daily active users on its platform. But it's still around that 200 million mark. It hasn't grown as big, but it's still very, very relevant, reaching more than 70% of under-25-year-olds in the US.

45. 18:25

    And Snapchat revenue has continued climbing as well, reaching more than $2.5 billion in 2020. So it's a very successful story showing that they created something, but they managed to keep innovating, keep their community around, and actually build a very successful business on top of that. So whether Clubhouse is going to be more like a Meerkat or more like a Snapchat is to be seen, and how their format is going to evolve and how their platform is going to evolve.

46. 18:50

    But audio growth is here to stay. Mainly it's driven by the behavior change in people, it's driven by the platform innovation by all of the large players, but most importantly the technology. AirPods, which completely transformed the industry in my mind, and opened up the same way as mobile and LTE connection opened up video streaming everywhere and mobile video and enabled the growth there. AirPods are truly enabling growth for audio.

47. 19:16

    So think about it, whether it's live audio rooms, podcasts, soundbites, music, or just starting to think about audio production for your own brand or your own creative endeavors. This is a key thing to think about in the future as audio is here to stay. Thank you very much for watching. I hope you enjoyed this video. If you did, it would really help if you leave a thumbs up. Subscribe to the channel and let's have a discussion below. What do you think are the biggest opportunities for audio and what you're seeing that might work or might not work?

48. 19:45

    Thanks again, and I hope to see you next time.