Here are our picks for the biggest fails in digital media and technology for 2017. The year’s tech fiascoes range from social-media agita about Russia’s U.S. election meddling to Snapchat’s camera-enabled sunglasses that nobody wanted, and from the flameout of China’s LeEco to the backlash over disturbing YouTube videos.
YouTube’s Brand-Safety Crises: Google’s video platform suffered advertiser boycotts after it was revealed that ads were being served against a variety of inappropriate content — including terrorism videos and content with young children targeted by pedophiles. Last month, YouTube said it had removed more than 150,000 videos featuring children that had drawn comments from predators and also disabled comments for over 625,000 videos. In the spring, after ads were discovered running in front of hate-speech and terrorism videos, several hundred marketers pulled their YouTube spending; some, including AT&T, haven’t run any ads on YouTube since March. Meanwhile, as YouTube scrambled to enforce stricter ad policies in the wake of the backlash, it raised the ire of creators who saw their ad revenue drop. (YouTube says it’s working to improve the accuracy of videos deemed advertiser-unfriendly.)
Social-Media Anxiety: Earlier this year, Facebook CEO Mark Zuckerberg issued a manifesto, explaining the company’s new mission would be “to amplify the good effects and mitigate the bad.” Well, it’s been a tough year in the court of public opinion for Facebook, as well as Twitter, as they’ve been forced to deal with the ills associated with social media — including violent videos and hate speech, fake news, and sexual harassment and other forms of cyberbullying. The highest-profile controversy involved congressional hearings in which Facebook, Twitter and Google execs were grilled on their role in Russia’s interference with the 2016 U.S. election. In its bid to provide fuller transparency, Facebook earlier this month acknowledged research showing that social-media usage may increase depression and feelings of isolation. In 2018, look for the social players to continue to try to show they’re good global citizens — in hopes of fending off new government regulations.
(L. to R.): Facebook general counsel Colin Stretch, Twitter active general counsel Sean Edgett and Google SVP and general counsel Kent Walker are sworn in prior testifying before the Senate Select Intelligence Committee on Nov. 1 2017. Credit: Shawn Thew/EPA-EFE/REX/Shutterstock
Snap’s IPO, Spectacles Both a Bust: Last year, ahead of its initial public offering, Snapchat renamed itself Snap Inc., and claimed it was a “camera company” — simultaneously announcing plans to sell video-enabled Spectacles glasses for pumping content into Snapchat. Neither the IPO nor the glasses gambit went well. After an initial burst, Snap’s stock has dropped more than 40% from its post-IPO high on disappointing user and revenue growth numbers. In October, CEO Evan Spiegel claimed the company had sold 150,000 pairs of Spectacles; but Snap had drastically overestimated demand for the glasses and reportedly has hundreds of thousands of unsold units warehoused in China. The company laid off a dozen members of its hardware team and in Q3 took a write-down of nearly $40 million for Spectacles, as Spiegel admitted Snap made the wrong call on the devices.
Seeso Shuts Down: NBCUniversal said “see ya” to the comedy subscription-video service just a year and half after it launched. After the company invested millions in the project, Seeso failed to gain traction for the $4-per-month for the Netflix-style offering, stocked with 2,000 hours of comedy content including “Saturday Night Live” episodes and originals like Dan Harmon’s “HarmonQuest” and “The Cyanide and Happiness Show.”
Fullscreen Kills Video Service: Touted as “not your father’s Netflix,” turns out the kids weren’t really interested in paying for original programming featuring digital stars like Shane Dawson, Tyler Oakley, and Andrea Russett. Fullscreen, owned by AT&T and Chernin Group, last month announced it was pulling the plug on the business after less than two years in the market; the service officially shuts down Jan. 5, 2018.
Fullscreen’s SVOD service, launched in April 2016, is shutting down next month. Courtesy of Fullscreen
Mashable’s Fire Sale: The once high-flying digital media company was acquired by Ziff Davis for $50 million, 20% of its previous valuation. The disappointing outcome for Mashable (and its investors) was emblematic of the economic woes that swept across digital media this year, as BuzzFeed, Refinery29, Moviepilot and others cut staff.
LeEco’s Collapse: Last year, Chinese billionaire Jia Yueting, then CEO of LeEco Group, had planned a major push for the company into the U.S. — inking a deal to buy HDTV-maker Vizio for $2 billion and launching low-priced smartphones and TVs along with a subscription streaming-video service. But in 2017, it became clear LeEco had overextended itself: The Vizio deal was nixed (leading Vizio to sue LeEco), and Chinese courts have frozen millions of Jia’s assets as creditors seek remuneration. In the latest chapter of LeEco’s downward spiral, its Hong Kong subsidiary filed a court notice this week to liquidate.
EA’s “Star Wars Battlefront II” Microtransactions Gaffe: Electronic Arts bombed big-time with fans of the “Star Wars” action-shooter game sequel by forcing players to buy credits (or spend an inordinate amount of time playing) to access key content and characters like Luke Skywalker — and giving an unfair advantage to those who bought the power-ups. According to one analysis, it would have taken 4,528 hours of gameplay or spending $2,100 to unlock all of the game’s content. EA apologized and temporarily suspended the game’s microtransactions; a critic labeled the model a “Star Wars-themed online casino” that preyed on kids.
“Star Wars Battlefront II” fans were furious that EA initially forced players to buy credits or spend hours playing the game to unlock iconic characters like Darth Vader. Courtesy of EA
Equifax’s Gargantuan Data Breach: The credit-monitoring giant disclosed in September that private data on 143 million consumers — roughly half the U.S. population — was stolen by cyberthieves. It’s one of the biggest privacy breaches in history, and Equifax is now the target of multiple regulatory probes and more than 240 lawsuits. Equifax blamed the debacle on a single employee’s error. Shortly after Equifax’s disclosure, Verizon announced that it discovered the 2013 hack of Yahoo had exposed info on 3 billion user accounts — triple Yahoo’s previous estimate, and representing everyone who had an account at the time.
PewDiePie Pacts Nixed After Nazi “Jokes”: Felix Kjellberg, the No. 1 personality on YouTube, lost business deals with Disney’s Maker Studios and YouTube after publicity of his videos with bizarre anti-Semitic themes. (PewDiePie tried to downplay the controversial videos as attempts at humor.) He also caught flak for using the n-word during a video-game live-stream. PewDiePie’s headaches illustrate the risks of the solo-creator approach. Despite the business setbacks, the vlogger remains more popular than ever — with more than 58 million YouTube subscribers and counting.