2016 predictions: a retrospective

I started the year with a list of predictions for 2016. In today’s post I’ll take a quick inventory of how I did on the year.

Predictions in bold. Outcomes follow.

1. Twitter will raise char limit to 10,000, but the average tweet length will stay below 200 chars.

It’s funny to look back on the year and think that, at it’s start, Twitter’s character limit decision carried the sort of weight that tops prediction lists (or, in any case, this one.) Given where the character limit policy landed, I’m counting this as a miss.

2. AWS will continue to dominate cloud computing services...

No change here. AWS continues to do very good things for Amazon.

That said, one of my favorite stories of the year (that I completely missed in my 2016 predictions) was the resurgence of Microsoft as a key player in cloud computing. Going into 2017, I’ll be keeping an eye out for how how Microsoft leverages its strong position in higher-level enterprise solutions (Office365, Active Directory) to drive adoption of its lower-level services, and vice versa.

3. ...but Amazon Prime will not unseat Netflix as a media streaming service.

At the start of the year, I wrote about how Netflix’s early jump on the global streaming market (and their CDN’s position with international network companies) was an advantage they’d hold over Amazon’s streaming offering. Now, in the light of Amazon’s own announcement to take their owned content global, I’m not so sure.

As both companies go global, the larger question I’ll look to in 2017 is how they’ll manage ballooning content costs. For Amazon, content costs can be justified as part of a larger strategy to bring consumers into their Prime model; for Netflix, not so much.

4. Oculus Rift will ship with early-platform games this year. VR won’t be a big deal for the general public until its use case expands to include GoPro360 home videos.

Though VR games shipped this year, the medium still seems more of a novelty for the majority of consumers. Moving into next year, I think the VR discussion will continue to revolve around gaming, with the main VR offerings (Oculus, Sony, Vive) duking it out in a VR platform war. (Here’s a great summary on the platform war from Lightspeed’s Alexander Taussig.)

5. Facebook (+Instagram) will continue to crush mobile ad sales.

Facebook had a big year. From the WSJ’s summary of their Q3 earnings report:

“The social media giant said Wednesday that third-quarter revenue soared 56% to $7 billion and its quarterly profit nearly tripled to $2.38 billion, as it reaps the spoils of its dominance in mobile advertising. Facebook’s top-line growth rate is double any other U.S. company with revenue of $20 billion or more, excluding those growing through acquisitions, according to data from Standard & Poor’s Capital IQ.”

For that, I’ll count this prediction as a win, but the interesting news from FB’s Q3 earnings report was what it held for 2017:

“Yet Facebook said that it can’t maintain its current pace. Starting in the middle of next year, Facebook will stop showing users more ads in their news feed, the tactic it has been using to juice revenue growth for the past two years, the company said Wednesday. As a result, advertising growth will “come down meaningfully,” Chief Financial Officer Dave Wehner said during a call with analysts.”

And so going into next year, as FB looks for new sources of growth, there are two main questions that I hope to see unfold:

  1. How much growth is left in the Instagram business. Given CFO Dave Wehrner’s comment from the Q3 call---“we’ve got 4 million advertisers on Facebook; 0.5 million advertisers on Instagram”--- I think the answer here is quite a bit. If that’s the case, perhaps we’ll get to see a breakout of the Instagram business in FB’s ‘17 reports.

  2. How Facebook will fare in mobile video. A few weeks ago I wrote about FB’s push to win mobile user-generated video share with FB Live, and how that live offering paled in comparison to Snapchat’s default ephemerality. Excited to see how this plays in ‘17, and whether FB Live or Instagram stories becomes the mobile video hit the company needs to compete with Snapchat on this front.  

6. The general public will continue to be underwhelmed by bitcoin’s impact, and overwhelmed by how it works.

In 2016 I heard little about bitcoin (outside of its recent rally) and lots about blockchain. I suspect this will be the lasting impact of bitcoin, that it introduced not a currency but a distributed canonical ledger for use in enterprise operations. IBM’s leveraging of blockchain in its supply chain management is one example of this from 2016. More to come in 2017.

7. ESPN will continue to lose subscription numbers; Disney will shrug off the ESPN decline because STAR WARS.

Cable subscriptions continue to decline at an increasing rate. The Force Awakens was a massive hit. We can expect to see Disney pump out a Star Wars movie annually, which is totally okay with me.

8. The Slack platform will be great, but not great enough to stave off a valuation markdown.

Big miss here. No valuation markdown and their platform strategy continues to grow, with a Google Apps integration announcement as the cherry on top. Still, Microsoft looms large in the enterprise collaboration space in 2017. And there will always be that open letter.

9. SpaceX Booster Landings. SpaceX will land two additional boosters in 2016, but the upcoming January landing at sea will miss.

Five booster landings on the year for the good people at SpaceX.  The January landing at sea missed. Counting this as a win.

10. Apple will be fine.

In 2016 Apple reported its first annual revenue decline in fifteen years. And yet, that news came in a quarter when Apple’s bottom line sat at $9B, when consumer demand for the 7-plus outpaced supply, and when their Q1’17 forecasts beat street estimates. No crisis here yet.

11. Hillary will win.

A miss.

12. “Facts” will not be on the new Kanye album.

Technically the “Charlie Heat Version” that made it onto TLOP, so counting this as a win.

13. You-know-who from Game of Thrones is still alive.

Got it.

14. The Warriors will set the record for most wins in a single NBA regular season.

Also got it.

Thus concludes my 2016 predictions wrap-up. With all matter of subjective generosity, I count four misses on the year. As always, thanks for reading.