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Yahoo Wants To Personalize Your Smartphone’s Home Screen

SAN FRANCISCO CHRONICLE
http://www.sfgate.com/business/article/Yahoo-wants-to-personalize-your-smartphone-s-5923534.php

Mark Daiss’ smartphone is more knowledgeable than the average device. It memorizes the Yahoo employee’s habits and where he lives and works. It can guess his next move and help him find the way to his next meeting. When he plugs in his headphones, it knows he wants to listen to music.

At any moment, his phone will suggest what he should know, and download information based on his location, the time of day and his own routine. It’s sort of like Samantha, the futuristic computer operating system in the movie “Her” — without the sexy voice.

Daiss and Yahoo call the software Aviate, playing off the idea that it helps users explore new apps and better navigate their smartphones.

The goal is to make the home screen more useful. On many smartphones, they look something like a grid, jam-packed with icons for apps. To Daiss, this arrangement is anything but smart.

“Our phones should be thoughtful about how that information surfaces,” he said.

With Aviate, a user waiting in line for the restroom at a 49ers game doesn’t have to thumb through pages of apps to check the score. Instead, GPS would detect that the phone is inside Levi’s Stadium and suggest helpful apps, including ones from the NFL, the stadium and Yelp (Does the hotdog vendor on the main concourse have four stars?). All it takes to see this data is a single click on an icon, in this case shaped like a football, in the corner of the home screen.

Users can opt to tell Aviate where they work and live, and it will provide convenient links to apps like Google Drive when they reach the office or Netflix when they return home.

“It helps people who haven’t meticulously organized their phones,” Daiss said.

Aviate was born out of a startup, which released a beta version of the app in October 2013. Yahoo acquired the company in January and released a free Android version in June. Yahoo wouldn’t comment on the cost of the acquisition (though some media reports peg it at $80 million), but said the app could help improve its search results.

Advertising sales

It could also aid Yahoo in the quest to increase its share of the advertising market. There aren’t any ads on Aviate today, though analysts believe Yahoo could use Aviate’s data to determine what people are searching for at specific locations and times. That information could yield even more tailored ads.

“From Yahoo’s standpoint, that would be something of great interest,” said Tim Bajarin, president of advisory services firm Creative Strategies.

Yahoo wouldn’t disclose how many people have downloaded Aviate, but on a given day, its users interact with Aviate 50 to 100 times, the company said.

Yahoo is continuing to increase its sales of search ads, with revenue up 4 percent to $452 million in the third quarter. But Yahoo still ranks third in search advertising revenue in the U.S. this year, behind Google, which has 72 percent of the market, and Microsoft, according to research firm eMarketer.

Some privacy advocates are concerned about the amount of data Aviate collects. Jamie Court, president of Consumer Watchdog, called Aviate a Trojan horse that lets Yahoo into Google’s system. Google has a similar app called Google Now, which also helps organize daily schedules, directions and suggest activities for users.

“The reality is that these types of applications, which pretend to serve you while sucking up all your available information, are not the ones that are going to last long on the market,” Court said. “Anyone who cares about privacy would never download this app.”

Some analysts said that as apps become more advanced, it will be up to the user to determine how much information to withhold — at the cost of service.

“As consumers we’re stuck in a new paradigm where we have to decide if we want to trade privacy for convenience,” said Greg Autry, an assistant professor of clinical entrepreneurship at the USC Marshall School of Business.

Ground rules

The minds that would create Aviate came together on Halloween 2011. Daiss, dressed that day as a Teenage Mutant Ninja Turtle, his cousin Paul Montoy-Wilson and William Choi each drafted a set of ground rules: Daiss wanted the freedom to nap at work, Choi refused early morning meetings, Montoy-Wilson wanted to have dinner with his wife each day.

After agreeing to those conditions, they spent several months brainstorming about ways to push the concept of search forward. With $1.8 million in venture capital and angel investment, the three tested some 20 versions of the app before opening Aviate to a beta test in October 2013.

The response was better than the startup expected, and companies began to express interest in buying their technology. From a list of suitors, Aviate ended up choosing Yahoo.

“We’ve been able to build the same vision we had at the start of the company,” said Daiss, who still takes naps at work, though now only once a month.

Yahoo has been criticized by an activist investor for its aggressive acquisition strategy, because the shareholder wants to see more revenue growth and more money returned to backers. In October, Yahoo revealed that it has spent about $1.6 billion buying dozens of companies, including Aviate, since CEO Marissa Mayer joined the company in 2012. Mayer said the company has spent $7.7 billion to repurchase shares during that same period.

Smarter screens

Mayer announced Aviate’s acquisition at the Consumer Electronics Show in January. During her presentation, she said Yahoo believes that home screens should be smarter and more personal. “The future of search is contextual knowledge, and we’re investing to be a part of this future,” Mayer said.

Daiss said he believes Aviate made the best decision in picking Yahoo as its buyer, and sees the company on an upswing.

“Products are getting better,” Daiss said. “There is so much opportunity for Yahoo to continue to grow.”

There are also more opportunities for apps that personalize the smartphone experience, analysts said. Daiss pointed out that one-third of text messages are about what people plan to do next. That could open the door for Aviate to push information that is relevant to what people are texting about.

“It would be so exciting to own the home screen of a phone,” Daiss said.

Wendy Lee is a San Francisco Chronicle staff writer. E-mail: wlee@sfchronicle.com Twitter: @thewendylee