Competitors circle Clubhouse

After Spotify makes a big acquisition, Clubhouse's future could all come down to Android

Dmitry Mashkin / Unsplash

Almost from the moment Clubhouse came onto the scene, Silicon Valley has been asking itself how long it can last. In my conversations over the past year with friends, venture capitalists, and executives at other tech companies, prospects for the social audio app and its growing number of imitators comes up more and more. Everyone wants to know: is it here to stay?

Today, let’s look at a number of recent developments that could affect that outcome — and talk about the one obvious ace Clubhouse has yet to play, and on which the company’s entire future could depend.

There are three key risks to Clubhouse’s continued rise. Let’s look at them in turn.

First, there’s competition. It’s a truism that startups are more likely to die of self-inflicted wounds than from other companies’ attacks, and that may well be the case with Clubhouse. But it’s also true that the established social networks are implementing Clubhouse-like features at an impressive clip.

Twitter Spaces is already in beta — and, in my experience at least, hosting lively conversations. Facebook reportedly has a version in the works as well. Audio chats have long been a feature of Discord, and they’re apparently coming to Slack, too.

Just before press time, LinkedIn confirmed that it is working on a Clubhouse rival of its own.

But today’s most interesting Clubhouse news is that Spotify has entered the live audio game. The company acquired Betty Labs, maker of the sports-flavored Clubhouse competitor Locker Room, for an undisclosed sum. Here’s Ashley Carman at The Verge:

As a result of the acquisition, Locker Room will stay live in the App Store but will be rebranded with a different name in the future on iOS and, eventually, Android with a broader focus on music, culture, and sports content. Spotify says it sees live audio as ideal for creators who want to connect with audiences in real time, whether that’s to premiere an album, host a question and answer session, or possibly even perform.

Gustav Söderström, chief R&D officer at Spotify, tells The Verge that Spotify will let anyone host conversations — not just approved creators — meaning its app will directly compete with all of the various live audio apps currently on the market, including Twitter Spaces, Clubhouse, and Discord. Although he says Spotify-employed creators won’t be required to go live only on Spotify’s app, he thinks it’ll be a “great complement” to their existing Spotify audiences. 

As Carman notes, Locker Room can take advantage of Spotify’s close relationships with the world’s most popular musicians and podcasters to instantly build out a powerful network of celebrity users. And not just any celebrity users — users whose primary medium is audio, and who are likely to use it in all sorts of compelling ways.

One threat a young social app can face is that it turns out to work better as a small feature inside an existing app. Another threat it can face is that someone else clones its core idea and uses it to build a bigger audience. Between Twitter and Spotify, we see Clubhouse facing both attacks at once — Spaces is an effort to turn Clubhouse into a feature, and Locker Room is an effort to use music and podcasts as a wedge into building a bigger and better network.

Those would be big enough challenges for any young app to confront. But Clubhouse has others, too.

The second challenge the company has is user retention. Earlier this month, Bebo founder and investor Shaan Puri wrote a widely read Twitter thread explaining the bear case for Clubhouse. It positioned two key uses for the app: listening to high-quality, well produced shows, many of them starring celebrities or other public figures; and “chilling” — relaxing with friends in a low-key digital space.

Each looks promising on the surface, Puri wrote, but came with challenges. Ensuring that there are high-quality shows to interest users across every category within a few seconds of them opening the app is a Herculean task. But focusing on “chilling,” while easier in some ways, would likely lead to much slower growth.

Notably, Puri included a chart showing estimated downloads from analytics firm AppMagic suggesting that Clubhouse had entered a steep decline in late February. According to another firm I checked, App Annie, Clubhouse fell out of the top 200 most downloaded apps in the United States last week.

And as Ben Thompson noted in a reply to Puri’s tweet, this analysis doesn’t even take into account what might happen as pandemic-inspired lockdowns ease up around the world, and fewer people have an hour or two to spare for meandering conversations on the evenings or the weekends.

What can Clubhouse do about this? One thing that strikes me is that the most successful social apps of the past decade have stood out for the way they make creation both easier and more fun. Clubhouse definitely makes live audio production much easier than what has come before — compared to a podcast recording, it’s trivial.

On the other hand, Clubhouse doesn’t have much in the way of creative tools — every conversation sounds exactly the same, which is to say like a phone call where everyone is constantly interrupting one another.

Where is the intro music? The sound boards? The licensed audio clips for songs, movies, and TV shows? There’s a lot to build there, and while I don’t know if it would change Clubhouse’s fate, it seems like an obvious area to explore.

Clubhouse’s final risk is also its biggest opportunity: it has to launch on Android.

If you doubt that there is pent-up demand for the currently iOS-only app, just search for Clubhouse on the Google Play Store. There you will find dozens of clones, many of which rip off the iOS app icon and falsely promise to deliver the full Clubhouse experience. (Does Google just, like, not care about this? Feels like these are fairly transparent fraud cases to me.)

There is precedent for a social app going truly mainstream after a long-delayed launch on Android: Instagram was iOS-only for its first two years; the day it was released for Android phones, 1 million people downloaded it. Six days later, Facebook bought the company.

But Android users bring some risk with them as well. A huge surge of new users brings all sorts of challenges with it: moderation, trust and safety, infrastructure, and so on.

So what happens when they come to Clubhouse? The company has said an Android version will launch soon.

For one, they’re likely to change the nature of conversations on Clubhouse. As it opens up from an invite-only group of users based largely in the coastal United States to a much more diverse audience, the mood of the app will shift. To be clear, that could be an excellent thing. But it remains to be seen whether the celebrities and Silicon Valley elites who helped to power Clubhouse’s rise will stick around once it loses its exclusivity.

None of this is to say that Clubhouse is doomed. As I wrote here in February, the serendipity that the app enables continues to feel surprising and fresh. And the war chest that founders Paul Davison and Rohan Seth raised from Andreessen Horowitz and others would allow them to pivot several times should their original vision begin to falter.

The default outcome for almost any startup is death, and we should rarely be surprised if and when it arrives. But I can’t be alone in feeling that the competition and product challenges that Clubhouse faces are mounting quickly. If the Android launch goes awry, Spotify and others will be only too willing to pick up where Clubhouse left off.

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Coming tomorrow: I crashed my friend Nilay Patel’s podcast Decoder to interview a special guest. Any guesses who? Subscribe to get it in your podcast feed early Wednesday morning. Or just wait for some good excerpts in tomorrow’s Platformer.

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The Ratio

Today in news that could affect public perception of the big tech companies.

🔃 Trending sideways: YouTube declined to remove “Meet the Flockers,” a song by YG that contains lyrics that some employees found racist to people of Asian origin. “The track, about a burglary, includes lyrics that encourage the targeting of neighborhoods where Chinese people live.” Employees are protesting on internal message boards. (Nico Grant / Bloomberg)

⬇️ Trending down: Amazon warehouse workers documented a year of retaliation in the run-up to the historic union election in Alabama. “The number of charges filed with the National Labor Relations Board accusing Amazon of interfering with workers’ right to organize more than tripled during the pandemic.” (Olivia Solon and April Glaser / NBC News)

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Governing

⭐ Facebook temporarily suspended the page of Venezuelan President Nicolas Maduro for spreading misinformation about COVID-19. Maduro promoted a “a remedy he claims, without evidence, can cure the disease,” Brian Ellsworth reports at Reuters:

Maduro in January described Carvativir, an oral solution derived from thyme, as a “miracle” medication that neutralizes the coronavirus with no side effects, a claim doctors say is not backed by science.

Facebook has taken down a video in which Maduro promotes the medication because it violates a policy against false claims “that something can guarantee prevention from getting COVID-19 or can guarantee recovery from COVID-19.”

Google faces a new class-action lawsuit over claims it sold user data contrary to its own claims. The case concerns whether data obtained by advertisers who bid on ad placements violates Google’s user agreements. (Joseph Cox / Vice)

Epic Games filed a brief in support of the UK antitrust investigation into Apple. The complaint mirrors similar arguments Epic has made in the United States and Australia regarding the App Store. (Tim Hardwick / MacRumors)

The American Bar Association, which could play a key role in the current antitrust debate, is stacked with former Big Tech employees. “Several of the group's most prominent members, they say, have cycled between top law firms and government agencies and defended clients including Facebook, Google, Amazon and Apple as they face intensifying antitrust scrutiny.” (Emily Birnbaum / Protocol)

The US government abandoned a 4-year-old antitrust case against Qualcomm. The Federal Trade Commission declined to appeal a federal court ruling that the chip maker had acted in anticompetitive ways. (David McLaughlin / Bloomberg)

India froze some bank accounts of ByteDance over alleged tax evasion. The company called it an abuse of the legal process; while TikTok is banned in the country, ByteDance still has 1,300 employees there. (Aditya Kalra and Abhirup Roy / Reuters)

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Industry

⭐ Snap’s next set of Spectacles smart glasses will be capable of displaying augmented reality effects. The company is also developing a camera drone, Alex Heath reports at The Information:

Unlike past models of Snap’s smart glasses, this version of the product is not meant for the consumer market but is instead aimed at developers and creators, said another person familiar with the plan. Those groups are already the creative force behind many of the wildly popular AR effects on the Snapchat app for mobile phones, known as lenses. Snap likely hopes the developers will come up with software experiences that can work on the new device, which could be offered to a wider group of customers at some point in the future.

Snap plans to announce the new Spectacles at its annual developer conference to be held virtually in late May, said the people, who requested anonymity to speak without the company’s permission.

⭐ A terrifying story about how a man stalked and threatened a 16-year-old TikTok star, eventually gaining access to her accounts and terrorizing her family. While sources interviewed for the story say the company largely does a good job preventing harassment, Ava Rose Beaune’s story speaks to the remaining dangers. (Samantha Cole / Vice)

Facebook’s chief revenue officer, David Fischer, announced plans to leave the company after more than a decade. The company announced a reorganization of its revenue and partnerships teams under a new role, chief business officer, to be hired soon. (Alex Heath / The Information)

Google Maps introduced new indoor walking directions using augmented reality. The feature is coming to airports, transit stations, malls, and other places that you might actually now visit once again in the next few months. (Jay Peters / The Verge)

Niantic teased new augmented reality smart glasses that it is building in partnership with Qualcomm. It also launched a demo of Codename: Urban Legends, a new multiplayer AR game. (Scott Stein / CNET)

LinkedIn added video features to user profiles for some reason. The more interesting part of the story comes when the manager of the company’s “creator strategy” explains why it is offering them zero monetization options. (Short version: “uhhh.”) (Ingrid Lunden / TechCrunch)

Cameo raised another $100 million, valuing the company at $1 billion. The company now has more than 40,000 personalities on the platform. (Sarah E. Needleman / Wall Street Journal)

Substack raised another $65 million amid a boom in newsletters like this one, valuing the company at $650 million. Gulp! (Kia Kokalitcheva and Dan Primack / Axios)

Apple’s Worldwide Developer Conference takes place June 7-11. iOS 15 is expected to be announced at the virtual event. (Chance Miller / 9to5Mac)

ByteDance is valued at $250 billion in trades of its stock on secondary markets. The stock is surging ahead of an expected initial public offering. (Lulu Yilun Chen, Coco Liu, and Zheping Huang / Bloomberg)

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Those good tweets

Molly Priddy @mollypriddy

can’t wait to put “fully vaccinated” on my dating profiles like an adoptable dog

P Money @Maechez1

I have no more passwords left in me

shelby @shelbytheclown

oh your roommate heard you fucking? poor baby, my roommate heard me doing zoom comedy...im moving out tomorrow

Peter Andringa @peterjandringa

Data Journalism is tricky, vol 243: counting days

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Talk to me

Send me tips, comments, questions, and Clubhouse rooms: casey@platformer.news.