Today’s episode of Company Forensics is about live-streaming apps, something that we all take very much for granted today as we’re not impressed anymore by seeing anyone going live on social media, to broadcast whatever from their phones. Literally, whatever... which is probably part of the problem here, but we’ll get into that later on.
While the idea of live broadcasting is anything but new, back in 2014-2015 it took the internet by storm when mobile applications made it easier for people to broadcast with just a tap, and most importantly, made it easier for audiences to connect with streamers. Before this, a live broadcast required a lot more technical stuff and that’s why it was reserved for television studios or websites like Livestream.
So, back then when the idea of live-streaming from smartphones was fresh, and the race to win that social media branch was just beginning, two particular apps held a deathmatch to become #1: Meerkat and Periscope. In this episode, we will review some key events of this battle, some differences between the apps, the role Twitter had in the story and finally, who won and where the winner stands in today’s market.
First, it was Meerkat, the live streaming app that became hot thanks to the 2015 SXSW, where it drew the public’s attention and gained traction at a pace that made everyone think it could be something big. The app had launched just a few days before the festival and got there without a lot of marketing money or sponsorships, but quickly broke through the endgame: users and word of mouth.
Having had a very successful story in Product Hunt, where apps like Foursquare had succeeded before, also contributed to the build-up. They reported their userbase doubled during the festival and got to a few hundreds of thousands, also getting lifts from popular characters who jumped on board, like Jimmy Fallon who broadcasted and tweeted using the app on the event.
But even after the SXSW buzz, other celebrities like Jared Leto or Madonna kept it alive and the community started looking big and strong.
Of course, there had been previous applications attempting to make live streaming social and earn that space, but they all failed. Meerkat was simple enough and was the first one to succeed in making it cool and social. But it did so by completely piggybacking on Twitter. So, let’s do a quick throwback here and see how the app worked.
To start, you could sign up with your Twitter account of course, and just like that have all of your followers available in Meerkat too. The home page was simple: you could see a list of currently live streams and you were prompted to type in what was happening, very much in Twitter’s fashion, then hit the stream button to start transmitting with your phone right away, or schedule it for later. In any case, as soon as you tapped one of those, all of your contacts on Twitter would get notified and get the link to jump into Meerkat to tune in.
The stream allowed viewers to like and comment in real-time, all of which was posted as well on the tweet, that could also be retweeted. In a nutshell, Meerkat’s whole reach to the audience relied on Twitter’s platform. But their party got to an end soon, just shortly after Twitter acquired Periscope for $86M, in March 2015.
Twitter was betting hard on video and had acquired Vine just a few months earlier. Check out our video on Vine, to find out what happened. No spoilers.
Only a few days before Meerkat’s breakthrough in SXSW, Twitter acquired the other app that could do what Meerkat did, but better. This was a kick in the butt for Meerkat, not only because of having a strong new competitor now, but also because Twitter did restrict some of Meerkat’s features that relied on their platform, seriously harming its social component. According to Ben Rubin, Meerkat’s founder, Twitter did this with a very short notice of only a couple of hours before pulling the plug, crippling their ability to react.
Twitter’s actions severely affected Meerkat of course, but also validated the market space and Meerkat had done enough to be able to raise a $12M series B, at a $40M valuation according to Techcrunch, also in March 2015. Yeah, 2015 was a big year for live streaming apps and that’s how fierce and fast the competition was, blow by blow. That investment round was led by Greylock Partners and one of the investors named Josh Elman posted a very optimistic note on Medium, where he even referenced the symbiosis of Meerkat with Twitter.
Some argued that it would’ve made more sense for Twitter to acquire Meerkat and leverage all the connections the app already had with it. But as you know, they followed Periscope’s development instead, apparently not paying much attention to Meerkat’s incursion in their platform, and finally went the Periscope route, despite Meerkat was already a trend on Twitter and Periscope hadn’t even launched yet.
Now, let’s talk about Periscope. In essence, It did pretty much the same as Meerkat but users reported that it did a better job handling delays in live streams and the UI overall was better, which ultimately just facilitated the social factor. This made sense because Periscope’s development took about a year while Meerkat took just around ten weeks to come to life, and that resulted in Periscope delivering a more polished product and experience.
Back in its early days, Periscope founders Kayvon Beykpor and Joe Bernstein said they wanted to create the closest thing possible to teleportation. Yeah, somehow the idea of being able to watch a live video broadcast of whatever you wanted to see from your phone, appealed to them as something close to teleporting, back in 2014.
Periscope founders have talked about how the idea was born when Bernstein was traveling in Istanbul and protests burst in Taksim Square. He then wanted to have real-time information and visual input of the development of the protests, but all he could get were tweets from people claiming to be there. So, from there they dreamed of a future in which you could just pick up your phone and tune in to watch and be transported to any place or experience, in real-time.
Yet another key difference Periscope had with Meerkat, was that live streams could be replayed if the streamer decided to keep them. This probably gave Periscope an advantage and it relates to a fundamental fact of consuming content on the internet: its nature is asynchronous. That’s right, the social media mindset isn’t really one for appointment viewing and our feeds are more and more asynchronous every time. This means you should probably look for ways to make your content available to more people, adapting to their behavior and schedule and not the other way around.
Unless you are famous or broadcasting a big event, chances are you’re going to struggle to find an audience for your live stream. A stroll on a beautiful beach sunset or your kid’s theater play may have value for those close to you, but would hardly appeal to a larger audience. Now, say your kid does something funny in the play, or something unexpected happens while walking on the beach, and suddenly the video may be interesting for others, but the synchronicity of watching it in real-time just loses relevance.
That’s ultimately a reality that both Meerkat and Periscope or any other social live-streaming app have to fight with. Still, by August 2015 more than 10M Periscope accounts had been created and nearly 2M used the app on a daily basis. However, by that time the app churn rates were high as well, some sources reported it being as high as 50%. And it was doing better than Meerkat.
Now, just as you could’ve imagined and expected, looking at the big picture it was only a matter of time before the big brother came into the live streaming game. That’s right, in August 2015 Facebook did what everyone expected it to do sooner or later and released Facebook live, becoming the final boss to defeat. Youtube live had existed for a while now but wasn’t by nature as mobile-centered at that time. Already being king of social media, Facebook was already much more than just live broadcasts and it was the natural thing to do.
So, for the rest of 2015 and until late 2016, Meerkat continued fighting, releasing some interesting features like allowing to stream using GoPro cameras or the developer platform and APIs. Periscope did their thing too, with features like an analytics dashboard for the streamers or a map integration to see live broadcasts from around the world by their location.
But eventually, in September 2016 Meerkat went belly up and its account on Twitter was shuttered and made private. Shortly after, it was removed from the Appstore, leaving Periscope victorious and ready for the real fight against Facebook.
Ben Rubin, Meerkat founder himself, acknowledged that the category of broadcast (one-to-many) wasn’t breaking as a daily habit to rely on completely, and it was too far away from the everyday user. By the time Meerkat died, the team had been working on a new project for about six months, an app called Houseparty. This one is still available in the Appstore and it’s something like video-chatting with groups of friends. It does not seem to do much more than what you can do with, say, Facetime, but still, it has managed to survive longer than Meerkat and without all the hype.
Surprisingly enough, Periscope has made it through and is still alive today too, but all the buzz and the excitement are gone. No need to say that Facebook Live became the social live streaming king, pretty much since it launched and leveraged almost 2B monthly active users it had by that time. Not a lot of analysis is required to know that any social app trying to dethrone Facebook will go against the odds.
We’re not really sure about what keeps Periscope going, considering the staggering competition, not only from Facebook but also from Youtube or Instagram. Casually logging into Periscope can be a rather underwhelming experience, as you scroll down a bunch of boring-looking streams, each with a handful of viewers. There are other use cases of course, but Facebook also dominates those ones, being the ground where brands and celebrities already advertise and monetize.
So, just for the sake of numbers, here are a few stats of Facebook Live and Periscope although the comparison may even look foolish. In 2018, Facebook’s live broadcasts reached 3.5B, while Periscope had only passed the 200M milestone in late 2016. By that same year, Periscope users viewed an average of 110 years worth of video time, daily. That’s 964,240.2 hours of video time. Well, Facebook users now view an average of 3000 years worth of video time daily, and that’s more than 26M hours of video viewed on a daily basis. That’s jaw-dropping.
In conclusion, live video streaming isn’t a great stand alone for social media and it requires exposure to a fairly big audience and userbase, to sustain interest. Just like Meerkat did in its early days leveraging a connection with Twitter, and ultimately as Facebook did it with its own platform, remaining the true winner of live video streaming and social media overall.
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