Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

Global app spending reached $65 billion in the first half of 2022, up only slightly from the $64.4 billion during the same period in 2021, as hypergrowth fueled by the pandemic has slowed down. But overall, the app economy is continuing to grow, having produced a record number of downloads and consumer spending across both the iOS and Google Play stores combined in 2021, according to multiple year-end reports. Global spending across iOS and Google Play last year was $133 billion, and consumers downloaded 143.6 billion apps.

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and much more.

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Top Stories

Apple prepares to allow alternative app stores in EU

Bloomberg reported Apple is already making efforts to open up its platforms to enable support for third-party app stores in the EU in advance of new requirements set out by the Digital Markets Act, which companies must comply with by 2024. EU regulators want to level the playing field for app developers and improve the consumer experience — and they believe forcing Apple to compete on merit with other app stores is one way to do it. Apple, of course, has long argued that allowing sideloading or third-party stores introduces too much risk to consumers, in terms of safety, security and privacy issues. Today, Apple handles payment processing for the apps downloaded from its own storefront, which includes battling fraud. And it restricts app makers from tracking users with the new App Tracking Transparency protections and protects user data.

But some of Apple’s privacy focus is a seeming front for its own aims in becoming a bigger competitor in the ads business. And as researchers recently discovered, some of Apple’s protections don’t apply to its own apps. Plus, many would argue, it seems like an imbalance to charge apps that rival Apple’s own services a commission on their businesses — the way it charges Spotify when it runs Apple Music; or how it charges streaming apps commissions, when it runs Apple TV+; and so on. Apple continues to expand into new app markets, too, with subscription services like Apple Fitness+; cloud storage packages through iCloud; news reading and magazines with News+; and others.

But app developers have long felt Apple’s 30% is too high a price for the discovery, distribution and security provided by the App Store. And for larger companies, they’re more than willing and able to market, distribute and sell their own apps themselves. Epic Games, for example, is battling Apple in courts over anti-trust issues, which are now under appeal. It wants to sell its apps like Fortnite directly to consumers and avoid Apple’s fees.

Still, even if the EU forces platforms to open up to more competition, if the laws aren’t precise, it’s possible Apple could find a way to adjust its policies to apply a commission structure to the third-party apps and app distribution systems the new regulations would allow.

It’s a wonder Apple has allowed the problem to get to this point. The company has carved back commissions for a range of apps — from smaller developers to “reader” apps and the like — in obvious attempts to hope soothe regulators and lawmakers’ concerns. But Apple may have ultimately misstepped by not just slashing commissions across the board to quell the developer backlash in the first place. As it turns out, Apple’s greed may ultimately be its downfall as it will now be up to regulators to set the terms, not Apple itself.

Lensa drives more AI art apps to top of App Store

Lensa AI’s popularity has had a notable impact on the App Store’s Top Charts this week. The photo and video editing app recently went viral over its new “magic avatars” feature, powered by the open source Stable Diffusion model, allowing users to turn their selfies into styled portraits of themselves as sci-fi, anime or fantasy characters, among other artistic renderings. Consumer demand for the app, and for AI edits more broadly, then pushed numerous other “AI” apps into the U.S. App Store’s Top Charts. By Monday, the top three spots on the U.S. App Store were all held by AI photo editors, and even more AI art apps are newly ranking in the Top 100.

This week, Lensa AI held the No. 1 spot on the U.S. App Store, with its 12.6 million global installs in the first 11 days of December, up 600% from the 1.8 million installs it saw during a similar time frame in November (November 20 through November 30), according to data from app store intelligence firm Sensor Tower. The U.S. accounted for 3.6 million of those new December installs, estimates indicate.

However, more AI apps have been climbing the charts. Data indicated that eight out of the top 100 apps by downloads on the U.S. App Store were AI art apps during the December 1 through December 11 time frame.

These included No. 2 and No. 3 apps, AI Art: AI Image Generator and Dawn – AI Avatars, respectively. The former saw 1.7 million global installs during December 1 through 11, up 229% from the 71,000 it saw during November 20 through 30. Dawn saw around 1.7 million installs, as well, up from the 28,000 it saw in the late November time frame.

Other apps filled the Top Charts, including No. 10 Wonder – AI Art Generator, No. 14 Prequel: Aesthetic AI Editor, No. 39 Voi – AI Avatar App by Wonder, No. 47 Meitu – Photo Editor & AI Art, and more. In select categories, like Graphics & Design, you’d also find Profile AI: Avatar Creator, Inspire – AI Art Generator and Dream by Wombo – AI Art Tool.

Clearly, developers learned to capitalize on consumer demand for AI art by keyword-stuffing their app names and descriptions with terms like “AI,” “Avatar,” “AI Art” and other search terms.

Despite the surge in consumer adoption, some are concerned about the ethics of using AI apps.

Lensa was trained on the Stable Diffusion model, which is controversial for how it used images from artists without their consent. Lensa was also able to be tricked into making NSFW images, TechCrunch found. And MIT Technology Review reported that Lensa created topless images and skimpy and sexualized avatars when tried by one female reporter, who happened to be of Asian heritage — suggesting the AI had been influenced by an overabundance of anime and video characters.

Instagram weighs taking on Twitter with text-based “Notes”

Amid backlash over the intrusion of algorithmic, recommended content into Instagram’s feed, Instagram this week introduced a number of new features to make it easier for users to keep up with their real-world friends. Among the new products is an addition called Notes — a feature Meta had considered turning into a Twitter competitor, The NYT recently reported. With Notes, users can update their friends using just text and emoji, adding a different format for social updates beyond the images and videos Instagram is best known for.

Though not a Twitter competitor in terms of the user interface, the idea of leaving text notes for others to read has some overlap with Twitter, or perhaps more specifically with a product like Twitter Circle, where you hand-pick people who can read your posts. In Instagram, however, users can leave notes by going to the top of their inbox, then selecting the followers they follow back (aka mutuals) or others from their existing “Close Friends” list. They’ll then type out the note itself using 60 characters of just text or emoji. The note will appear at the top of friends’ inboxes for 24 hours and replies will arrive as DMs.

What’s interesting is that Meta had considered making Notes a more direct Twitter competitor. The NYT said Meta weighed making Notes its own feed in the Instagram app or even making it its own app. For the time being, however, the company is launching the product — which has been in testing for several months prior — as is. Too bad.

Developer News

• iOS 16 adoption has hit 69%.
• The iPhone 14’s new Emergency SOS via satellite feature rolled out to the U.K., France, Germany and Ireland.
• iOS 16.2 was released on Tuesday. This bigger update brings a number of new features, including improved encryption for iCloud data, Live Activities on the Home Screen, a new karaoke feature for Apple Music, new AirDrop restrictions and Apple’s new Freeform app. It also patches a zero-day flaw in WebKit.

• iOS 16.2 is also bringing a mystery AirTag firmware update. No one knows what it does yet.
• Apple also released the first betas for iOS 16.3, iPadOS 16.3 and macOS Ventura 13.2.
• Android 13 for TV has shipped.
• Compose for Wear OS 1.1 is now stable. 
• Android 13 QPR2 Beta 1 is now available. The Android 13 Beta is continuing with the next round of updates for its March 2023 release. These Quarterly Platform Releases are delivered to Pixel phones as Feature Drops.
• Android 13 is now hitting Sony smartphones, according to user reports, including the Xperia 1 IV, the Xperia 5 IV, the Xperia 1 III, the Xperia 5 III and the Xperia Pro-I.
• Google completed the rollout of the Matter smart home standard to Android and Nest. Apple and Samsung have already rolled out Matter support, and Amazon will support Matter by end of 2022.

App Updates

• Flipboard is capitalizing on Twitter’s chaos. The social magazine app will now allow its magazine curators to start discussions with readers through a new Notes feature, where they can write posts, share images and links, ask questions and more.
• Twitter re-launched its subscription service Twitter Blue with different price points for those who subscribe on iOS and those who subscribe on the web. The new subscription will provide the verified checkmark and reduce ads, among other things, but will now have increased protections to prevent spam and impersonation, the company claims. Blue for Business will give businesses on Twitter gold checks instead of blue. (That’s right — Blue will give out gold checks, too. Did anyone think through the branding here?!)
• Twitter made its community fact-checks visible to worldwide users. (The Community Notes feature was previously called Birdwatch.)
• Meanwhile, Twitter shut down its newsletter platform Revue, shortly after former Twitter CEO Jack Dorsey used it to write a post about the Twitter Files, warning against attacks on Twitter’s staff. He also touched on decentralization and his own effort in that space, Bluesky.
• Elon Musk suspended a Twitter bot that tracked his jet’s coming and going. For, you know, reasons. After issuing his new jet-tracking-inspired anti-doxing policy, Twitter then begin banning prominent journalists without warning, including those who tweeted about Musk’s decision to also ban Mastodon’s account. Some of the suspended journalists had posted images of the tweet that got the Mastodon account banned — a post that pointed to the bot (ElonJet)’s account on Mastodon.

• TikTok goes horizontal. The company confirmed it’s testing a horizontal full-screen mode which makes the app more competitive with YouTube.

• Microsoft is shutting down its Authenticator app for Apple Watch users in January 2023.
• A little-known phone monitoring app called Xnspy has stolen data from tens of thousands of devices, TechCrunch reported.
• A nifty media organizer app, Sofa, was updated with new features like shared lists, Lock Screen widgets, support for Shortcuts and more.
• Game maker Playtika has laid off 610 employees and is shutting down three titles — MergeStories, DiceLife and Ghost Detective.
• Netflix launched two more games, this time with top game publisher Annapurna Interactive. One is Kentucky Route Zero, developed by Cardboard Computer and published by Annapurna Interactive. The other is Twelve Minutes, developed by 24 Bit Games. The company also said it’s developing a new game based on its historical drama “Vikings: Valhalla.”

• Spotify is scaling back its live audio plans. As the Clubhouse frenzy wears off, Spotify is ending several of its live shows, including “Deux Me After Dark,” “Doughboys: Snack Pack,” “The Movie Buff” and “A Gay in the Life.”
• Tinder launched “Relationship Goals,” similar to sister app Hinge, which allows daters to more specifically say what they’re looking for.
• YouTube will now notify users whose abusive comments are removed for violating the rules, and will then ban the user from posting for 24 hours if they continue to leave abusive comments.
• Instagram launched a new hub to help users who suspect their accounts have been hacked, or who can otherwise not log in due to more common problems like a lost password or lost access to two-factor authentication.
• PayPal and MetaMask teamed up. MetaMask said it’s adding an integration in its crypto wallet that will allow users to buy cryptocurrencies using their PayPal account.

Government, Policy and Lawsuits

• A bipartisan group of U.S. lawmakers introduced a bill that would ban any social media company, including TikTok in — or under the influence of — China or Russia or other U.S. adversaries.
• Triller responded to the Sony Music lawsuit over its unpaid licensing fees, confirming it has been unable to issue payments for a “range of reasons,” but did not disclose what they were.
• An advisor to France’s privacy authority (The Commission nationale de l’informatique et des libertés, or CNIL) recommended fining Apple €6 million, saying iOS 14 didn’t meet EU privacy requirements. The issue at hand is that Apple didn’t extend the same tracking protections offered to users (like ATT) to its own first-party apps.
• Twitter’s lead privacy regulator in the EU, the Irish Data Protection Commission (DPC), is reviewing Twitter’s plan to force personalized ads on users unless they pay for a Twitter Blue subscription allowing them to opt-out of ads.
• The U.S. Senate unanimously passed the No TikTok on Government Devices Act, after 13 states imposed similar bans due to security concerns over use of the app.

Downloads

Trendio

TechCrunch’s Aisha Malik this week took a look at the new video shopping app Trendio, co-founded by a former Amazon Prime Video executive. The app, designed for shopping makeup and beauty products, offers personalized content and easy ways to purchase beauty products through both live and recorded videos from creators. Supported brands include Merit, Philosophy, Ursa Major, Nudestix, Kjaer Weis, Joanna Vargas, Coola and Avene.

The startup was co-founded by Alex Perez-Tenessa, the former vice president of Prime Video U.S. and head of Beauty at CVS, and startup veteran David Olmos. Also on the team are Amazon Live alum Julie Novak and former Glossier head of Make-up Category Management, Leah Grubb. You can read TechCrunch’s full review here.

This Week in Apps: AI Art apps top the charts, Instagram adds text-only ‘Notes,’ alternative app stores in EU by Sarah Perez originally published on TechCrunch