Weekly reading – 3rd December 2022

What I wrote last week

My notes from the 2022 McKinsey Global Payments Report

Business

($) Adidas Top Executives Discussed Risk of Staff’s ‘Direct Exposure’ to Kanye West Years Ago. This mismanagement and scandal raise a serious red flag on Adidas. The influence of Kanye West impacts the company’s financials so much that it put up with the artist’s horrible and childish behavior for so long. Despite repeated complaints from employees. Is it really worth putting an iconic brand through the mud?

($) Why America Doesn’t Have Enough EV Charging Stations. “The government is pouring billions of dollars into developing a national highway charging network. But businesses aren’t sure how they will make money, and the nascent industry looks messy. Utility companies and gas stations are at war with each other over who will own and operate EV chargers. Rural states say some charging stations could operate at a loss for a decade or more. New companies that provide charging gear and services are contending with the equipment’s spotty reliability. The network’s build-out has a chicken-or-egg quality: EV advocates say many drivers will only be comfortable purchasing vehicles if rapid charging is as easy as using a pump at a gas station. Yet businesses interested in offering charging say they can’t make money until more EVs are on the road. Around 1% of U.S. drivers own EVs, but wait lists are growing and auto makers including General Motors Co. and Ford Motor Co. are expecting EV sales to keep rising. Wisconsin’s Dairyland Power Cooperative told the Biden administration in August that sparsely used chargers in the northern part of the state would likely “operate at a loss for years” and that rural areas need flexibility in planning. Maine officials said the operation of some sites may need government subsidies because they won’t turn a profit for a decade. Wyoming estimates that no rural charging station built to the requirements the federal government expects—four chargers placed every 50 miles along highways—would be profitable until the 2040s.”

It’s not your imagination: Shopping on Amazon has gotten worse. The article is a serious warning to Amazon, its executives and shareholders. It reflects my experience with the website lately. Search results are no longer authentic. Most are driven by ads. Items are delivered improperly. Wait times get longer. Prices are no longer competitive. It’s a far cry from what it was 2 or 3 years ago. Once consumers leave, what’s left for Amazon to hold on to?

($) Apple Makes Plans to Move Production Out of China. Trade wars and the unrest in China are making it difficult for Apple to continue to rely on the supply chain network in the country. It is not a surprise that Apple is hedging its bets by moving some production to other countries, but I don’t expect to see the fruits of this effort any time soon. Apple will have to find a country where it’s more stable and friendly to do business; to find partners that have the human and technology capital to handle the workload; to work out the logistics part to link every piece of the supply chain jigsaw. That’s not easy by any means

Source: The Transcript
Cumulative Gross Merchandise Volume Processed By Shopify During Black Friday. Source: Tobi Lutke

Other stuff I find interesting

($) It’s Public Land. But the Public Can’t Reach It. Before reading this piece, I didn’t know that there were acres of public lands that could not be reached because they were surrounded by petty private land owners. In fact, there are 15 million acres of federal and state land that is “landlocked” by private properties. This phenomenon begs the questions: who gets to go where and how do citizens get to public land without being charged of trespassing?

The dirty road to clean energy: how China’s electric vehicle boom is ravaging the environment. People praise electric vehicles for their impact on climate change because they are not emitting carbon dioxide. Well, these EVs require batteries which force us to destroy the environment to build. When we tally up everything we do to get EVs on the roads, are they still a net positive to our life and environment? That argument looks shaky now

New energy storage technologies hold key to renewable transition. “Long duration energy storage (LDES) generally refers to any form of technology that can store energy for multiple hours, days, even weeks or months, and then provide that energy when and if needed. It is a technology that is essential if the world is to increase the proportion of renewable energy, given it is an inherently intermittent source. The Long Duration Energy Storage Council, launched last year at COP26, reckons that, by 2040, LDES capacity needs to increase to between eight and 15 times its current level — taking it to 1.5-2.5 terawatts (85-140 terawatt hours)— to enable a cost-optimal net zero energy system.

Apple’s iPhone 14 Emergency SOS via Satellite Feature Saves Stranded Man in Alaska. Saving one life is already worth having this feature in my opinion.

Stats

2022 Black Friday sales exceeded $9 billion

Harvard Business Review has 220,000 subscribers who pay for print and digital access, half of which are digital readers only

By 2027, data centres will consume 31% of Ireland’s electricity

An estimated 37 per cent of the world’s population – or 2.9 billion people – have still never used the Internet.

Death from road accidents, per million people from OECD countries. Source: NYTimes
Black Americans are most likely to live alone. Source: NYTimes

Weekly reading – 26th November 2022

What I wrote last week

Attention to detail matters

Business

Welcome to the Ambaniverse. It’s scarcely believable to me how much Mukesh Ambani and his companies touch the life of Indians

($) What Do the Worst (and Best) Airports Look Like? Ask United Airlines. Ever flew with United Airlines to/from Newark and got delayed? This article will share some insights as to why.

The ‘Amazon of Africa’ is reducing staff and cutting premature products in its new era. Amazon relies on its grip over loyal shoppers who subscribe to Prime in order to woo advertisers and merchants. Jumia is doing the opposite. The company claimed that it was marching towards profitability and cutting initiatives that were not contributing to that goal. A Prime-like subscription is likely not profitable, but it remains to be seen if it is wise to go ahead without one. I really look forward to seeing how Jumia will be in two years and their reflection on the decision made today

Tax filing websites have been sending users’ financial information to Facebook. I haven’t used any website listed in the article, but I am pretty angry. The practice of sharing tax data with another party without consent is distasteful and fraudulent. Even if tax-filing websites shield themselves by using the “terms and conditions” page that nobody ever really reads, the government should just outright ban that deceitful practice and prosecute those that don’t safeguard consumer data properly.

($) Disney’s Robert Iger Loomed Over His Successor as CEO, Creating Tensions. I feel like FTX & SBF and Twitter & Musk became some sort of old news when the headlines were all taken over by Disney and Bob Iger. Bob Chapek’s tenure was littered with missteps and investor doubt. I had a serious concern when he decided to jack up prices at the parks. He increased the streaming target significantly, albeit with little experience to show for it. There were also problems with Scarlett Johansson and Florida’s Governor De Santis. The fact that he was let go is not without cause. What surprised everybody is Bob Iger’s return. He was Disney’s CEO for 15 years and repeatedly reneged on his promise to pick a successor multiple times before choosing Chapek. Bob Iger was a legendary CEO when he retired. The man built Disney’s massive IP library, took the company’s name & its properties to new height and delivered blockbuster after blockbuster. But the company he is taking over faces different challenges than when he left. There is no telling that he will succeed this time. Is he a better choice than Chapek? I think so. Does Iger’s return mean that the company is out of the woods? Not necessarily.

The Perks of a High-Documentation, Low-Meeting Work Culture.I am a fan of a culture that favors documentation and writing. First of all, writing fosters deep thinking and sharpens ideas. Second, it can level the playing field for people who that speak the language fluently. For those who don’t write well, I do think it’s an easier fix than to ask non-native speakers to articulate their points naturally. Third, great documentation transfers knowledge seamlessly. No matter who leave or stay, the domain knowledge stays with an organization and gets passed on to the next persons through write-ups, memos or reports. Last but not least, as the article mentioned, meetings have a way of disrupting and lessen the actual work

($) Was This $100 Billion Deal the Worst Merger Ever? A long great read on the AT&T – Time Warner merger that will go down in history as one of the worst mergers and value destructions ever. Several factors contributed to the mess: a legal debacle that took two valuable years, two cultures that never gelled, the cut-throat competition and executives who didn’t have a strategic plan nor execution to realize all the potential value, if there was any.

Other stuff I find interesting

($) North America’s EV Future Hinges on a North Carolina Turtle Pond. “In Kings Mountain, North Carolina, there’s a tree-filled park that provides urbanites from nearby Charlotte some respite in nature. At its center is a tranquil pond, featuring turtles, fish and other wildlife. The sparkling waters, which plunge some 150 feet deep, are the result of decades of accumulated rainfall in a defunct lithium mine. By contrast, China dominates the global supply chain for EV batteries, boasting 79% of the world’s lithium-ion battery manufacturing capacity, versus just 5.5% for the US.

Megalopolis: how coastal west Africa will shape the coming century. Visiting Africa and the stretch described here is a dream that I want to realize in the next 10-15 years. “By the end of the century, Africa will be home to 40% of the world’s population – and nowhere is this breakneck-pace development happening faster than this 600-mile stretch between Abidjan and Lagos. It is a stretch of coastal west Africa that begins in the west with Abidjan, the economic capital of Ivory Coast, and extends 600 miles east – passing through the countries of Ghana, Togo and Benin – before finally arriving at Lagos. Recently, this has come to be seen by many experts as the world’s most rapidly urbanising region, a “megalopolis” in the making – that is, a large and densely clustered group of metropolitan centres. When its population surpassed 10 million people in the 1950s, the New York metropolitan area became the anchor of one of the first urban zones to be described this way – a region of almost continuous dense habitation that stretches 400 miles from Washington DC to Boston

A very handy website on industrial tourism in Japan

The truffle industry is a big scam. Not just truffle oil, everything. There are three biggest takeaways for me: 1/ the truffle oil is a fraud; 2/ depending on the type of truffle and when it can be harvested, out-of-season truffle is also a fraud because it cannot be preserved for long; 3/ there are many types of truffles and some can be much more expensive than others

Stats

e-bike sales in Finland (by units) in 2022 increased 53% year over year

Alexa is reportedly on track to lose $10 billion this year

Brands pay young YouTubers a lot of money for product placements, from $75,000 to $300,000

Weekly reading – 19th November 2022

What I wrote last week

PayPal has a monetization problem with Venmo

Harvard Business Publishing

Business

Why investors have jumped off the Carvana bandwagon. Carvana is another example that reminds me of that famous quote from Warren Buffett: “Only when the tide goes out do you discover who’s been swimming naked.”

Basically everything on Amazon has become an ad. “Successful Amazon sellers have to spend anywhere between 10 percent and 20 percent of their sales on Amazon ads, according to six high-volume sellers Recode interviewed. That’s on top of the other listing and warehousing fees they also give Amazon. Some said that the pay-to-play evolution of the site is one of the top two reasons they have had to substantially raise the prices of their merchandise on Amazon over the past year.” This is going to spell trouble for Amazon soon. A few of my purchases were off Amazon simply because the same items sold on the site were markedly more expensive. Keep this up and the company will soon have to re-acquire customers and rebuild its brand image. That’s too high a price to pay, just for advertising dollars.

Local ride-hailing startups thrive in the towns that Uber forgot. Giant ride-hailing companies compete fiercely with one another in big cities, leaving small and medium-sized towns ripe for the taking. And they are being taken over by local startups that saw unserved markets and decided to act. To grow, these startups should not venture into big cities. They should strive to continue to serve small and medium-sized towns across the continent. Regarding the likes of Uber, I don’t blame them for not attending to these small towns. Resources are limited and they can’t stretch themselves too thin.

Global Twitter employees describe chaos as layoffs gut their teams. The word chaos can’t even describe what is going on at Twitter, especially to the staff in India. Axing 50% of the policy team and 75% of the product team can’t benefit the company.

Sam Bankman-Fried vs. The Match King. The last few days have been littered with news and coverage of Sam Bankman-Fried (SBF) and FTX. The glamour and the superficial valuation masked the mess that went on behind the scenes. But this scandal is hardly the first. Not even close. This post compares what happened with SBF & FTX with the Match King, a businessman who had great success early on yet ruined everything when he was consumed by greed

The vomit-inducing piece on Sam Bankman-Fried by Sequoia. The venture capital firm is legendary for its longevity, success and role in helping entrepreneurs and startups thrive. However, this is a serious black eye. They penned this ridiculously flowery article on SBF, stuck it on its website under the tagline “We helped the daring build legendary companies”, yet removed it the moment news of trouble at FTX surfaced. Worse, the article recalled a meeting where the firm’s partners met Sam. No hard questions and little due diligence. They were wowed by SBF, who was literally playing games during the meeting. Mind-blowing stuff

Other stuff I find interesting

FTX turmoil destroys clout of crypto’s Washington spokesman. The fall of SBF and his companies apparently threatens to bring my regulatory heat onto crypto firms in the future. Well, I personally think that it’s a bit late. Regulators should have had more oversight and scrutiny over these crypto companies and celebrities.

TikTok’s Subcontractor in Colombia Under Investigation for Traumatic Work. On one hand, I understand that a job is a job, even one that requires people to watch horrifying content for hours. On the other hand, there should be safeguards built to ensure that these workers are treated properly and all measures are taken to limit the exposure to mentally harmful content.

People protested when this capital city went car-free. Now they love it. Ljubljana, the capital of Slovenia, sets an excellent example of how cities can transform themselves with micromobility and car-less space.

Stats

US consumers spent $72.2 billion online in OCtober 2022, according to Adobe

Americans have almost $5 trillion in cash as of Q2 2022

Honey bee life spans are 50% shorter today than they were 50 years ago

The world’s population hit the 8-billion mark on 11/15/2022

US online grocery sales totalled $7.8 billion in October 2022

Global lithium supply & demand forecast
Source: Global lithium supply & demand forecast by BloombergNEF

Weekly reading – 12th November 2022

What I wrote last week

My review of the US Bank Shopper Cash Rewards Visa Signature Credit Card

Business

($) What If Apple Made an E-Bike? On paper, the idea that Apple would change the e-bike/micromobility industry forever with its own product makes sense. The question is: how would an e-bike connect with the rest of the ecosystem? How would all devices complement one another? Apart from transporting a person from A to B, what utility would an e-bike provide?

The Russo Brothers Assemble: Inside AGBO, Their $1 Billion Studio, and When They Might Return to Marvel. Some insights into the entertainment industry

Why we’re leaving the cloud. I am not a fan of DHH, to say the least, but I appreciate his and his company’s perspective on this issue. Indeed, one of the biggest selling points of cloud providers is that you can save time and money renting their infrastructure. I am not saying that it’s impossible. But every buyer needs to do their homework and run a trial to see if that’s the case. My first-hand experience with our company’s transition to AWS is that we have a net positive, but you need to remember that most banks run on mainframes which are expensive to service in the first place.

($) Adobe Is Trying to Spend $20 Billion to Buy Back Its Swagger. I honestly don’t understand why people compared this to Facebook’s acquisition of Instagram. To me, because of the price tag, this deal looks similar to the $19 billion purchase of WhatsApp by Facebook. Nonetheless, I think there is a real chance that regulators would block this deal given the recent developments.

Stack Overflow CEO on how it became the world’s most popular programming site. A few stats on Stack Overflow: 50 million questions & answers, 100 million monthly visitors worldwide, 50 billion visits in the last 14 years, 15,000 organizations that use StackOverflow-for-Teams

Emergency SOS via satellite on iPhone 14 and iPhone 14 Pro lineups made possible by $450 million Apple investment in US infrastructure. There is innovation that doesn’t make headlines, yet improves lives. There is also innovation that grabs all sorts of attention, yet seems to be based on imagination than reality. Meterverse and this Emergency SOS, guess which one improves lives?

The global shipping industry is facing a new problem — too many containers. The demand for shipping dropped significantly, to the point that there are idle containers. I wonder if this is a sign that a recession is coming upon all of us.

Number One in Formula One. As much as I disliked Mercedes’ dominance in F1 the past decade, I have nothing but respect for their achievements because they were earned honestly. Toto Wolff is a magnificent team principal and his leadership lessons shared in this article are invaluable

Other stuff I find interesting

TSMC approaching 1 nm with 2D materials breakthrough. Any company or country still on chips bigger than 20nm is essentially years behind

US Traffic Safety Is Getting Worse, While Other Countries Improve. “The US underperformance in road safety is especially dramatical: 11.4 Americans per 100,000 died in crashes in 2020, a number that dwarfs countries including Spain (2.9), Israel (3.3) and New Zealand (6.3). And unlike most developed nations, US roadways have grown more deadly during the last two decades (including during the pandemic), especially for those outside of cars. Last year saw the most pedestrians killed in the US in 40 years, and deaths among those biking rose 44% from 2010 to 2020. That narrative is hogwash. For proof, look no further than Canada, an equally spacious and car-centric neighbor where the likelihood of dying in a crash is 60% lower.

The Car Safety Feature That Kills the Other Guy. Owning a truck is a waste of space & fuel and it increases risks of collision. For the lift of me, I never get used to sitting in my car next to a truck that is twice as big. “After decades of decline, U.S. road deaths flattened and then began rising about 20 years ago. Some 42,915 people died in crashes during 2021, a 16-year high. Notably, it was also 20 years ago that the American flirtation with SUVs and trucks became an all-out obsession. These vehicles first outsold cars in the U.S. in 2002; they have been gobbling up the market share ever since. SUVs and trucks may leave their occupants feeling safer, but they create grave dangers for everyone else on the street. A 2015 federal study found that an SUV is two to three times more likely to kill a pedestrian than a car is, and economist Justin Tyndall has tied the ascent of SUVs to an increase in pedestrian deaths, which hit a 40-year high in 2021. Cyclist deaths, meanwhile, rose 44 percent from 2010 to 2020.”

India has lost 70 million hectares of farmland since 2015. Climate irregularities which are likely caused by our carbon emissions severely impact India’s agriculture and food security. It could be a global theme one day in the near future

Stats

In highly polluted areas, or if plastic pollution continues to rise in the future, the whales could be eating 150m pieces a day

SEC obtained record $6.4b in monetary sanctions in past fiscal year

90% of electric vehicles sold in France in 2021 were two-wheelers

90% of new vehicles sold in Norway in 2021 were either electric or hybrid

Weekly reading – 5th November 2022

What I wrote last week

Apple Earnings

Small but important things

Business

How Google’s Ad Business Funds Disinformation Around the World. A large scale investigation into how Google’s Ads benefit sites that distribute misinformation in non-English speaking countries. I understand that this problem is not easy, but Google is known for engineering prowess and this is an engineering problem. If ads still shows up on sites flagged as misinformers, it’s because someone decides to turn a blind eye on them. “ProPublica also scanned close to 10,000 active articles that fact checkers in the three Balkan countries flagged for false claims since 2019. Just over 60% were earning money with Google. The articles included a range of falsehoods about national politics, the pandemic, vaccines, the war in Ukraine and other topics. Dejan Petar Zlatanovic operates Srbin.info, a Serbian website that publishes pro-Kremlin propaganda copied from Russian state media, election conspiracies about the U.S. and anti-LGBTQ content. Its homepage features a prominent hyperlink directly to the official Kremlin website. Google ads abound there and on article pages. Zlatanovic said in an email that Srbin.info earns between $5,000 and $7,000 per month, with Google ads providing a key portion of the revenue.

The Hype Cycles of Venture Capital. Our society praises monumental wins of venture capitalists passionately and holds those men and women in high regard. But I don’t see the same vigor in criticisms when they fumble millions of capital on new, exciting and…useless ideas. Anyone remember Clubhouse? Or Bird?

Inflation – Stealing From Savers. The headline is that inflation is not going away any time soon and investors will have a hard time to earn sizable returns

After leading $20 billion Figma deal, Adobe’s David Wadhwani is in prime spot to be next CEO. As an Adobe shareholder, I feel good reading this article. Who’s better to succeed the current CEO than the guy championing the subscription business model and having the credentials of leading AppDynamics to be acquired by Cisco.

($) Big Tech’s Dirty Supply Chains Undercut Climate Promises From HQ. “Amazon.com Inc., Microsoft Corp. and Alphabet Inc. have pledged to run their own operations on 100% clean power. But their suppliers — the lesser known companies that make the key components of hit products like the Kindle, the Xbox or Pixel mobiles — remain deeply reliant on fossil fuels. Twelve of the 14 top suppliers get on average 5.4% of their energy from renewable sources or don’t disclose, data from a Greenpeace report released Friday showed. Taiwan’s TSMC is sucking up as much electricity as Sri Lanka’s 21-million population and is expected to use up 12.5% of the island’s annual power consumption by 2025. More than half of Taiwan’s energy is generated from coal and fossil fuels. In South Korea, home to another critical chip-supplier, SK Hynix, the story is similar. The company’s chip factories consume power equivalent to 1.6 million South Korean households and more than 60% of the country’s power comes from burning coal and natural gas.”

JPMorgan Chase wants to disrupt the rent check with its payments platform for landlords and tenants. This is an exciting new product from JP Morgan. It’s so frustrating that tenants have to pay by checks every month because landlords refuse to upgrade their infrastructure. I myself was asked to provide a check as collateral the last two times I tried to book a facility in my apartment building. I abandoned the booking simply because I refused to go to a branch just for a check. For JPMorgan Chase, this can be a strategically great move. At $500 billion in rent payment volume annually, even 0.2% of interchange and/or processing fee can bring in an extra $1 billion in revenue. Landlords that park their rent payments in a Chase account can help the bank get more deposits to fund their more lucrative loan-originating business. Last but not least, even if JPMorgan Chase doesn’t require landlords or tenants to be a customer of the bank, this new platform can serve as a tool to scout new prospects. Think about it this way. If the bank knows the address and rent-paying behavior of a prospect, it can leverage that data to craft a profile and run a marketing campaign toward that profile accordingly. That information is first party, reliably accurate and NOT easy to have.

This is how much more Apple Music pays artists than Spotify [Video]. I wonder what non-disclosure agreements these streaming services have with artists. But this is damning to Spotify. If a few more artists come out to back up this revelation, they will be under pressure to increase payout and that would mean higher expenses and less margin. Investors will not like that

Apple CFO talked about the small scale of his Finance team and how efficient they are

Other stuff I find interesting

How the New York City steam system works. The story of steam actually begins in Ancient Rome, where enterprising Romans were already building steam pipe systems for heating buildings and baths. The technology spread to the rest of Europe, but it was in the United States during the late 19th century. Inventors and businessmen turned it into a commercially viable heating option for towns and cities. New York was the first major city in the U.S. to have a steam system and still has the largest one to this day. In fact, if you add up the next five largest steam systems in America, it’s still smaller than New York City’s.

In Greece’s largest port of Piraeus, China is the boss. Europe must be mindful of these investments in key infrastructure by China. If there is opposition to China getting semiconductor technologies from the US, why shouldn’t there be caution when it comes to key infrastructure?

Why Switzerland built a 2-kilometer-long train. I am marveled by the fact that there is a 2km-long train out there. I wouldn’t get on board if the train was operated in many countries, including Vietnam. But since this is the Swiss we are talking about, I’d give it a shot.

The enduring sexism of India’s tech industry. With 1.3 billion people in population and a big portion of that as women, India would be even more competitive if they could foster a culture more liberating and friendly towards women

Vietnam is luring tech giants out of China with flashy infrastructure projects. If our country just provides lands and labor, there will be little transfer of technological, commercial or scientific knowledge. Don’t get me wrong. It’s good to increase the GDP and all that for Vietnam, but I’d prefer us taking a page out of Singapore’s playbook.

($) The Metals for Your EV Are Stuck in a 30-Mile Traffic Jam. This is an eye-opening account on how copper is transferred from mines to ports in Africa. My gosh, what a tough gig it is. The whole continent is hungry for infrastructure investments that will make thousands of lives easier and improve commerce. Rich countries wishing to establish influence should pay attention and act before China does, if they haven’t already

Stats

Meta’s Reality Labs is projected to cost as much as the Apollo Program, the very one that landed humans on the Moon

37% of small business owners in the U.S. were unable to pay their rent in full and on time in October

Weekly reading – 29th October 2022

What I wrote last week

Uber plans to advertise to riders based on destination data

Business

Forget Netflix and Disney: a local streaming service is king in Indonesia. Vidio is winning because it understands the local audience and what they want from a streaming service.

ESPN, Formula 1 Extend Track With New Rights Deal. Formula 1 has seen its popularity soar high across the globe and in the US in the past two years. Some say that Netflix’s Drive To Survive elevated the sport’s standing. Others say that being one of a few sports organized during the pandemic to entertain folks at home helped too. Whatever the reason is, it’s undeniable that more American viewers know about Formula 1 than ever before. Viewership has never been this high. Next year, the country will host races in Las Vegas, Miami and Texas. There is a strong chance that an American driver, Logan Sergeant, will be on the grid too. The stars seem to be aligned well for the sport I love

($) The Fantasy of Instant Delivery Is Imploding. Some venture capitalists are poised to book millions of dollars in losses. “Along with entering too many markets, they overspent on marketing, with billboards in Times Square and European soccer and Formula One team sponsorships, former finance executives say. During Gopuff’s billion-dollar funding rounds, the co-CEOs had also sold portions of their stock to investors. (Rank-and-file Gopuffers were not allowed to sell shares unless approved by the company.) After they became multimillionaires, they purchased a Gulfstream jet and mansions five minutes from each other along the Intracoastal Waterway in Miami’s Golden Beach. Gola also bought Joe the Jeweler a home in Cherry Hill to replace the one he’d lost when his cash-for-gold business went bust.

Exclusive: YouTube’s new redesign is built to feel more like TV. Some insights into how YouTube redesigned its User Experience. It must have been a massive undertaking and I’d love to be a fly on a wall of the meetings that led to decisions being made on the new design.

Square sells access to your inbox. No one seems to know if the law cares. Read how Block (Square) collects your email and sells access to said email to hundreds of sellers. The company also goes to great length to circumvent regulations pertaining to consumer privacy.

Apple on iPhones, Chips, Privacy, Working From Home and More | WSJ Tech Live 2022. I like Joanna Stern as a journalist and a tech reviewer. She is smart, funny and knows her stuff. This interview was really good and featured some hard-hitting questions that, unfortunately yet unsurprisingly, Craig and Joz evaded. Their response to Joanna’s question regarding EU mandate on USB-C was more nuanced than what was widely reported on the news. Their opposition to the Metaverse, a concept that Facebook/Meta champions, was noteworthy. Plus, I found it good Joz’s brief explanation on why ATT was introduced. Overall, if you have 30 minutes to spare, you really should check out this interview.

White House hammers economic issues with attack on ‘junk fees’ two weeks out from Election Day. While they are at it, they should talk to AirBnb CEO Brian Chesky on the outrageous fees that hosts on his platform charge to guests.

Other stuff I find interesting

Little rules about big things. Morgan Housel is one of my favorite writers and he struck gold again. “Most financial mistakes come when you try to force things to happen faster than is required. Compounding doesn’t like when you try to use a cheat code. Risk’s greatest fuels are leverage, overconfidence, ego, and impatience. Its greatest antidote is having options, humility, and other people’s trust.”

Voyage of the Gross Even though every other option is better, most of New York’s trash still goes into a hole in the ground. A fascinating piece that describes the journey of…trash in New York

($) The World’s Biggest Source of Clean Energy Is Evaporating Fast. “The water woes of China’s iconic mega-dam are part of a global hydropower crisis that is being made worse by global warming. From California to Germany, heatwaves and droughts have shrunk rivers that feed reservoirs. Hydroelectricity output fell by 75 terrawatt-hours in Europe this year through September — more than the annual consumption of Greece — and fell 30% across China last month. In the US, generation is expected to fall to the lowest level in six years in September and October. It’s a cruel irony that’s forcing utilities to reconsider the traditional role of hydropower as a reliable and instant source of green energy. Dams are the world’s largest source of clean energy, yet extreme weather is making them less effective in the battle against climate change.

Stats

84% of maternal deaths in the US are preventable

“Only five percent of plastic waste generated by US households actually gets recycled”

One out of four US adults under 30 gets news on TikTok

The FDIC’s 2021 National Survey of Unbanked and Underbanked Households also found an estimated 4.5 percent of U.S. households were unbanked

Online spending in Southeast Asia is forecast to reach $200 billion in 2022 and $330 billion by 2025

Source: Reddit

Weekly reading – 22nd October 2022

What I wrote last week

Apple’s pricing strategy

Business

Kroger has to win over Wall Street and Washington on its Albertsons deal – here’s how it plans to do that. It’s entirely plausible that there are operational synergies between the two companies. For instance, instead of having two purchasing departments of 1000 people, the combined company may only need 750 after the acquisition. The combined forces can likely result in more bargaining power and lower item expenses. What I seriously doubt are 1/ whether the two companies can gel together culturally and 2/ whether they have the capability to pull off advertising. Cultural mismatch is among the biggest reasons why acquisitions or mergers fail. The bigger a transaction, the bigger this risk. Regarding advertising, yes, it is a high-margin business. But these two grocers hardly have experience in delivering the kind of advertising that can convince investors that splurging out $25 billion is the best use of their capital. We’ll see.

($) Even After $100 Billion, Self-Driving Cars Are Going Nowhere. “Our driverless future is starting to look so distant that even some of its most fervent believers have turned apostate. Chief among them is Anthony Levandowski, the engineer who more or less created the model for self-driving research and was, for more than a decade, the field’s biggest star. Now he’s running a startup that’s developing autonomous trucks for industrial sites, and he says that for the foreseeable future, that’s about as much complexity as any driverless vehicle will be able to handle. Self-driving companies have fallen back on shortcuts. In lieu of putting more cars on the road for longer, they run simulations inside giant data centers, add those “drives” to their total mile counts, and use them to make claims about safety. Simulations might help with some well-defined scenarios such as left turns, but they can’t manufacture edge cases.

World’s top chip equipment suppliers halt business with China. The measures sound draconian, but in order to stop China from growing its semiconductor industry, I believe this is what it takes. At least, it will bring the Asian country to the negotiation table

Shein and the Tech Cold War. If you heard about Shein but don’t know much about the company, read this!

NFL Sunday Ticket still up for grabs as Apple pushes for flexibility with game rights. As an Apple shareholder, I do think Apple is doing the right thing by holding its grounds. Apple TV+ is still a minor player in the streaming market and likely unprofitable at this point. Tacking on an NFL package that costs arms and legs wouldn’t make it a profit center overnight. Hence, there needs to be a strong business case for Apple to shell out the kind of money that NFL is demanding. If there is no win-win solution, I’d rather see Apple leave the negotiation.

Apple freezes plan to use China’s YMTC chips amid political pressure. One of the most valuable companies in the world put on hold a product plan which it has been working on for years because of geopolitical conflicts between the US and China.

($) Coming Soon on Netflix: A New Netflix. Content released in batches, instead of the binge model. Focus more on quality instead of quantity. Crackdown on password sharing. A new ads-supported tier. A significant change in culture. A new Netflix is starting to form. Bears will say that because Netflix is doing all the things it said it would never do, that’s a sign of a company in decline. Bulls will argue that the new changes will allow Netflix to compete in a hyper-competitive streaming market. Either way, the company is unlikely to regain its former valuation or the “darling of Wall Street” position that it once held

Is the Uber, Lyft and gig economy battle over workers nearing its end game? It is unreasonable to force companies to pay full-time compensation to workers who want the flexibility of the gig model. Regulators on the left love to enact rules to protect workers’ interest. The intention is great, but they need to find a common ground here. Right or wrong, the fact remains that many workers love the freedom that the gig model offers. Any new regulation needs to take that into account. Plus, additional expenses will eventually be passed onto consumers. Unlikely there is competition as the biggest players like DoorDash, Uber or Instacart will have the scale advantage over smaller companies.

Exclusive: Amazon’s attrition costs $8 billion annually according to leaked documents. And it gets worse. A damning report on employee attrition problem at Amazon. It paints a picture of a company that has serious control issues. Andy Jassy’s reign has been littered with challenges so far. Stock rout, slow growth, miscalculated planning in terms of hiring and warehouse capacity, departure of experienced veterans and leaders, and now this. I am a fan of Amazon and a shareholder myself, but this really gives me some food for thought on the outlook of the company

Source: Twitter

Other stuff I find interesting

New York seems to have a weed store on every corner. None of them are legal. A fascinating read on the unnecessarily complicated situation regarding the legality of marijuana selling and buying in New York.

Why high speed rail hasn’t caught on. The economics of high speed rail (HSR), the bumpiness of the Earth, the technical challenges of building and maintaining safe trains are the main factors why HSR is not yet popping up in many countries

Minerva Lithium uses absorbent material to change the way we extract lithium. The tech here looks very promising, given the importance of lithium in how we advance technologies and how harmful the extraction of lithium is environmentally

Stats

Almost 25% of the world’s sea bed has been mapped

75% of the Time We Spend With Our Kids in Our Lifetime Will Be Spent​By Age 12

As of Q3 2022, Apple Pay captures 44% of in-store mobile wallet transactions

How Americans spend their money
Source: Visual Capitalist

Weekly reading – 8th October 2022

What I wrote last week

Take-aways from CFPB’s report on Buy Now Pay Later

Business

($) Apple’s Tech Supply Chain Shows Difficulty of Dumping China. A good piece on how dependent American companies are on China. Case in point, it is estimated that it would take Apple 8 years to move 10% of the production capacity out of the country.

The Legacy of Jack Welch’s Managerial Capitalism. A brutal indictment of Jack Welch and his managerial practices. I often heard people quote Jack on many things business-related. Hence, it’s refreshing to have an opposing view.

Elon Musk’s Texts Shatter the Myth of the Tech Genius. “The texts also cast a harsh light on the investment tactics of Silicon Valley’s best and brightest. There’s Calacanis’s overeager angel-investing pitches, and then you have the more chill tactics of people like Andreessen, who in a tossed-off Twitter DM offered Musk “$250M with no additional work required.” “Thanks!” Musk responded. In a separate exchange, Musk asks Ellison if he’d like to invest in taking Twitter private. “Yes, of course,” Ellison replies. “A billion … or whatever you recommend.” Easy enough. For this crew, the early success of their past companies or careers is usually prologue, and their skills will, of course, transfer to any area they choose to conquer (including magically solving free speech). But what they are actually doing is winging it.”

($) ‘I Am Energy’: Inside the Bang Billionaire’s Reeling Empire. This CEO would have more success if he hadn’t let his success get into his head

Embedded Finance: What It Takes to Prosper in the New Value Chain. An excellent piece by Bain on Embedded Finance

It’s Time to Start Worrying About Peacock. This is another example of analyzing data with context. Growing a subscriber base by 2 million users seems great, till one goes through what NBC had to do in the last few months to get that growth. As it turns out, there is a lot more going on that just that absolute number.

A very solid overview of financial statements and how to read them by PwC

Other stuff I find interesting

Can industrial tourism help revitalize Japan’s manufacturing regions? I, for one, would love to travel to Japan just to see how things are done. Like matcha, wasabi, Japanese swords, etc. Those long-standing craftsmanships are just beautiful.

Study reports first evidence of social relationships between chimpanzees, gorillas. Enhanced foraging opportunities, not survival from predators, are the bigger reason why chimpanzees and gorillas bond socially, according to the research. I have nothing but deep respect for researchers who spend years working on something that ordinary people like me rarely care about. To advance our science and the understanding of the world.

Coding in a war zone: Ukraine’s tech industry adapts to a new normal. A fascinating on how tech companies and workers prepared well in advance for an invasion and reacted to a new reality when Russian troops rushed in. I would be so unsettled if my employer, on my first day at work, handed me a package in case wars happened.

Stats

Apple Music has 100 million songs

Plant-based dairy is a $2.6 billion category

Source: Senator Elizabeth Warren
Source: Gallup

Weekly reading – 1st October 2022

What I wrote last week

The push to grow the complex Bundles by Disney

Decoupling – A great tool to analyze business strategies and disruption

Business

Instacart Offers Grocers the Future of Grocery in a Bundle. Instacart becomes a much more interesting company with these innovations. Pushing a heavy cart around and waiting in line forever just to check out is not a great customer experience. The Caper Cart sounds like a game changer for grocers, shoppers and Instacart. These products are so different economically than delivery services. This helps diversifying Instagram, adding revenue stream and reducing risks.

Why India’s small sellers still don’t trust Amazon. The relationship between Amazon and Indian sellers is so strained that I struggle to see how the company can succeed in this important market.

What Chinese media reveals about Shein’s secretive operations. “There are two main kinds of suppliers: “free on board,” those that make simple designs they haven’t devised themselves, and “original design manufacturers,” those that do both. They all feed into Shein’s sprawling manufacturing execution system (MES). The designer-suppliers will find pictures online and send a selection to Shein’s internal buyers for consideration; the buyer and their manager settle on a final pool. Once samples have been received, there might be two, or even three, rounds of changes before manufacturing can commence. (The entire time, everything needs to be recorded in the MES — materials, pricing, even chat logs — something suppliers balk at, because, if the deal falls through, all the information sits in Shein’s records, and there’s nothing to stop them from producing it elsewhere.). hein is ruthlessly efficient when it comes to evaluating its suppliers, according to analysis by Zhongtai Securities. A scoring system sorts the wheat from the chaff. Timeliness of procurement and delivery, stocking and delivery, rate of defects, and the success rate of new products make up 40% of a supplier’s score. The remaining 60% is based on order volume. They are then tiered into five levels, and the bottom 30% of the lowest tier are culled.”

The Ascendancy of Ahold Delhaize. “Ahold Delhaize USA has been strengthening its position as it looks to take its hyper-local value proposition national. After blockbuster revenue years in 2020 and 2021, Ahold Delhaize has demonstrated that it can keep growing by focusing on omnichannel innovation, prioritizing value and expanding its assortment of high-quality, low-cost private-brand products. “

($) The Unstoppable Rise of Aldi in Britain Shows No Sign of Slowing. “A recent visit to Purley, south London, found the parking lot outside Aldi boasting BMWs, Land Rovers and Porsches and shoppers choosing Aldi over nearby branches of Lidl and Sainsbury, as well as the upmarket Waitrose 10 minutes away. An extra 1.5 million customers have visited Aldi over the past three months. When sales were up by at most the low single digits at most UK supermarkets, they rose 19% at Aldi and 20.9% at Lidl. Part of the strategy is economy of scale. Aldi has about 2,000 key products in store, compared with as many as 30,000 in some large rival supermarkets. By stocking just one ketchup, for example, Aldi has a tight supply chain and can avoid pricing rows like Tesco’s recent spats with Kraft Heinz Co. and Mars Inc.

How Bryan Lourd became one of the most powerful people in the history of Hollywood. A phenomenal story. Bryan Lourd worked his way from a mail room to being one of the most powerful people in Hollywood.

How Arm conquered the chip market without making a single chip, with CEO Rene Haas. I am not a fan of Nilay or The Verge’s new website look, but this is a great interview on one of the most important players in the chip industry. Especially when Arm is not really a household consumer name

Amazon dominates the $113 billion smart home market — here’s how it uses the data it collects. Amazon has a major trust issue because no matter what the company says, I don’t think consumers trust Amazon to do the right things with their data.

Other stuff I find interesting

Why the Rush to Mine Lithium Could Dry Up the High Andes. “With the world’s car fleets transitioning to electric propulsion, Argentina, with reserves of up to 60 million metric tons, according to government estimates, is well-positioned to profit from the lithium rush. Lax regulation and low taxes make its part of the Lithium Triangle — in the northwestern provinces of Jujuy, Salta, and Catamarca — “especially attractive for foreign investors,” according to Lucas Gonzalez of the National Scientific and Technical Research Council (CONICET), a government agency in Buenos Aires. The country could soon become the world’s second-largest lithium producer, after Australia, and the largest producer from evaporative mining. But every ton of lithium carbonate extracted from underground using this cheap, low-tech method typically dissipates into the air about half a million gallons of water that is vital to the arid high Andes. The extraction lowers water tables, and because freshwater often sits on top of salty water, this has the potential to dry up the lakes, wetlands, springs, and rivers that flourish where the underground water reaches the surface.

Charging cars at home at night is not the way to go, Stanford study finds. “The move to electric vehicles will result in large costs for generating, transmitting, and storing more power. Shifting current EV charging from home to work and night to day could cut costs and help the grid

New ways to make more sustainable choices. I’d love to try out these new features, especially the updates on recipes

iPhone 14 Pro Review: No phone is an island. I like Jason’s review of iPhone 14 Pro. A few friends of mine belittled Apple for the lack of innovation. I mean, that criticism is fair when it comes to the lower lineup iPhone 14, but the Pro version is much further ahead with a lot of cool features and innovation. It’s also great financially for Apple, to sell more expensive and higher margin phones, especially when there is shortage of components.

How Apple Pay works under the hood? An example of how complex payments are under the hood and how far technology has come to enable such complexity in mere seconds

Stats

Biden’s plan to cancel student loans will cost taxpayers $400 billion, among the most expensive initiatives his administration puts forward

6000 children died on EU roads in ten years

Amazon commits to hiring 5,000 refugees by the end of 2024. A big YES to this!