Posts Tagged ‘apple’
“If I could explain it to the average person, I wouldn’t have been worth the Nobel Prize”*…
Alex Murrell on the surge of sameness all around us…
The interiors of our homes, coffee shops and restaurants all look the same. The buildings where we live and work all look the same. The cars we drive, their colours and their logos all look the same. The way we look and the way we dress all looks the same. Our movies, books and video games all look the same. And the brands we buy, their adverts, identities and taglines all look the same.
But it doesn’t end there. In the age of average, homogeneity can be found in an almost indefinite number of domains.
The Instagram pictures we post, the tweets we read, the TV we watch, the app icons we click, the skylines we see, the websites we visit and the illustrations which adorn them all look the same. The list goes on, and on, and on…
Perhaps when times are turbulent, people seek the safety of the familiar. Perhaps it’s our obsession with quantification and optimisation. Or maybe it’s the inevitable result of inspiration becoming globalised…
But it’s not all bad news.
I believe that the age of average is the age of opportunity…
Lots more mesmerizing examples: “The age of average,” from @alexjmurrell.
* Richard Feynman
###
As we think different, we might recall that it was on this date in 1976 that Steve Jobs, Steve Wozniak, and Ronald Wayne signed a partnership agreement that established the company that would become Apple Computer, Inc.– a company that was all about trumping sameness– on January 3, 1977.
Wayne left the partnership eleven days later, relinquishing his ten percent share for $2,300.
“There must be some other way out of here, said the joker to the thief / There’s too much confusion, I can’t get no relief”*…
The dangers of rapid scaling: Praveen Seshadri on what ails Google and how it can turn things around…
I joined Google just before the pandemic when the company I had co-founded, AppSheet, was acquired by Google Cloud. The acquiring team and executives welcomed us and treated us well. We joined with great enthusiasm and commitment to integrate AppSheet into Google and make it a success. Yet, now at the expiry of my three year mandatory retention period, I have left Google understanding how a once-great company has slowly ceased to function.
Google has 175,000+ capable and well-compensated employees who get very little done quarter over quarter, year over year. Like mice, they are trapped in a maze of approvals, launch processes, legal reviews, performance reviews, exec reviews, documents, meetings, bug reports, triage, OKRs, H1 plans followed by H2 plans, all-hands summits, and inevitable reorgs. The mice are regularly fed their “cheese” (promotions, bonuses, fancy food, fancier perks) and despite many wanting to experience personal satisfaction and impact from their work, the system trains them to quell these inappropriate desires and learn what it actually means to be “Googley” — just don’t rock the boat. As Deepak Malhotra put it in his excellent business fable, at some point the problem is no longer that the mouse is in a maze. The problem is that “the maze is in the mouse.”
It is a fragile moment for Google with the pressure from OpenAI + Microsoft. Most people view this challenge along the technology axis, although there is now the gnawing suspicion that it might be a symptom of some deeper malaise. The recent layoffs have caused angst within the company as many employees view this as a failure of management or a surrender to activist investors. In a way, this reflects a general lack of self-awareness across both management and employees. Google’s fundamental problems are along the culture axis and everything else is a reflection of it. Of course, I’m not the only person to observe these issues (see the post by Noam Bardin, Waze founder and ex-Googler).
The way I see it, Google has four core cultural problems. They are all the natural consequences of having a money-printing machine called “Ads” that has kept growing relentlessly every year, hiding all other sins.
(1) no mission, (2) no urgency, (3) delusions of exceptionalism, (4) mismanagement…
A provocative diagnosis: “The maze is in the mouse.” Eminently worth reading in full.
* Bob Dylan, “All Along the Watchtower”
###
As we go back to basics, we might recall that it was on this date in 1955 that a boy was born to University of Wisconsin graduate students Joanne Simpson and Abdulfattah Jandali. He was given up for adoption and taken in by a machinist and his wife in Mountain View, California. They named him Steve Jobs.
“Other things stop working or they break, But batteries… they die”*…
There’s been a great deal of talk about semiconductors and the implications of a supply chain that depends too heavily on China– and some action (c.f., e.g., here and here). Fair enough: chips are clearly central to the economy into which we’re growing; assuring access matters. But let us not forget their humble technological cousin, the battery. Batteries power an increasing number of the appliances on which our lives increasingly depend; with the world gearing up for the electric vehicle era, we’re going to need them even more. So it could be an issue that the world is much more reliant on China for batteries than for chips…
Battery manufacturing has become a priority for many nations, including the United States. However, having entered the race for batteries early, China is far and away in the lead… In 2022, China had more battery production capacity than the rest of the world combined…
Global lithium-ion manufacturing capacity is projected to increase eightfold in the next five years… China’s well-established advantage is set to continue through 2027, with 69% of the world’s battery manufacturing capacity…
Battery manufacturing is just one piece of the puzzle, albeit a major one. Most of the parts and metals that make up a battery—like battery-grade lithium, electrolytes, separators, cathodes, and anodes—are primarily made in China.
Therefore, combating China’s dominance will be expensive. According to Bloomberg, the U.S. and Europe will have to invest $87 billion and $102 billion, respectively, to meet domestic battery demand with fully local supply chains by 2030…
More (and a larger version of the graphic above) at “Visualizing China’s Dominance in Battery Manufacturing (2022-2027P),” from @VisualCap.
* Demetri Martin
###
As we recharge, we might recall that it was on this date in 1984 that Apple aired an epoch-making commercial, “1984” (directed by Blade Runner director Ridley Scott), during Superbowl XVIII– for the first and only time. Two days later, the first Apple Macintosh went on sale…. battery-dependent portables followed a few years later.
“Create more value than you capture”*…
A thoughtful consideration of Web 3.0 from the always-insightful Tim O’Reilly…
There’s been a lot of talk about Web3 lately, and as the person who defined “Web 2.0” 17 years ago, I’m often asked to comment. I’ve generally avoided doing so because most prognostications about the future turn out to be wrong. What we can do, though, is to ask ourselves questions that help us see more deeply into the present, the soil in which the future is rooted. As William Gibson famously said, “The future is already here. It’s just not evenly distributed yet.” We can also look at economic and social patterns and cycles, using as a lens the observation ascribed to Mark Twain that “history doesn’t repeat itself, but it rhymes.”
Using those filters, what can we say about Web3?…
There follows a fascinating– and educational– analysis of the state of play and the issues that we face.
Tim concludes…
Let’s focus on the parts of the Web3 vision that aren’t about easy riches, on solving hard problems in trust, identity, and decentralized finance. And above all, let’s focus on the interface between crypto and the real world that people live in, where, as Matthew Yglesias put it when talking about housing inequality, “a society becomes wealthy over time by accumulating a stock of long-lasting capital goods.” If, as Sal Delle Palme argues, Web3 heralds the birth of a new economic system, let’s make it one that increases true wealth—not just paper wealth for those lucky enough to get in early but actual life-changing goods and services that make life better for everyone.
“Why it’s too early to get excited about Web3,” from @timoreilly.
See also: “My first impressions of web3” from Matthew Rosenfeld (AKA Moxie Marlinspike, @moxie, founder of @signalapp).
* Tim O’Reilly
###
As we focus on first principles, we might recall that it was on this date in 2007 that Steve Jobs introduced the iPhone at MacWorld. The phone wasn’t available for sale until June 29th, occasioning one of the most heavily anticipated sales launches in the history of technology. Apple sold 1.4 million iPhones in 2007, steadily increasing each year; estimated sales in 2021 are 240-250 million.
“There are two times in a man’s life when he shouldn’t speculate: when he can afford to and when he can’t.”*…
Robinhood, the trading platform supposedly meant “to democratize finance for all”: not all change is progress; not all “disruption” is for the good…
… What is Robinhood?
The company operates a mobile app that enables consumers to trade stocks, options, and crypto. These orders are the company’s inventory, which it sells to “market makers” — large financial institutions that pare (execute) the trades in the market. As with Google or Facebook, Robinhood’s users are not its customers, but its supply.
This means Robinhood is incentivized to keep its users trading … a lot. The goal: make stock trading as addictive as social media scrolling. RH has enjoyed success here. The proportion of users who check it daily rivals those of Twitter, Snapchat, and Facebook.
…
The transaction at the heart of the company’s model is “Payment for Order Flow” or PFOF. Because RH generates its revenue by selling orders to market makers, it doesn’t charge commissions to its consumer users. But this also creates a conflict of interest for the company, which is motivated to sell orders to the market maker that offers the highest payment for the trade rather than the best price. It’s like affiliate marketing, but for your financial future.
PFOF goes back to the 1980s, when it was pioneered by, wait for it … Bernie Madoff. Madoff relied on the practice to make his firm one of the leading market makers of its day, and when regulators raised questions about whether it presented a conflict of interest, he used his position as the chairperson of Nasdaq to prevent restrictions. (PFOF is illegal in the U.K.) There was no conflict of interest, Madoff assured his colleagues, because “there are very strict rules that I would assume most firms comply with.”
Robinhood is the latest example of an increasing trend: tech companies for whom illegality is a feature, not a bug. Uber is an $86 billion gypsy cab company. Facebook and Google have received so many fines, it’s likely the companies internally classify them as a cost of doing business. This is tantamount to replacing civics courses with prison training, because … well … that’s how we roll.
For its part, RH has racked up: a $70 million settlement with FINRA, a $65 million SEC fine (for failing to properly disclose PFOF), and a separate $1.25 million FINRA fine. And on Wednesday, on the eve of pricing its IPO, the company disclosed that its senior executives are under investigation by FINRA for failing to acquire broker-dealer licenses. In addition, another inquiry is under way into the possibility that RH employees made illegal insider trades during the GameStop frenzy early this year.
Once, that type of disclosure would have dismembered an IPO. Instead, 48 hours after it made the disclosure, Robinhood was publicly trading at $32 billion. Telling point: The company paid its chief legal officer, Daniel Gallagher, more than $30 million in 2020, even though it hired him halfway through the year. From 2011 to 2015, Gallagher was an SEC Commissioner. Our business environment has morphed from capitalism, which depends on the rules of fair play, into cronyism.
Flouting the law is now a signal to investors that a firm is “disruptive.” Established companies, which believe they have too much to lose, have spent years investing in a culture of compliance to protect themselves. Disrupters, with access to cheap capital and few legacy assets, have no such constraints. In Robinhood’s case, no less an establishment bulwark than Goldman Sachs has blessed its approach to business by taking the lead on the company’s IPO. Forget orange — criminality without consequence is the new black.
…
In practice, Robinhood’s activities look more like the dispersion of financial risk than the “democratization of finance” — kind of like if a for-profit prison claimed to be “democratizing housing.” As both an app and as an investment, RH makes more sense in the context of gambling than investing. Its business model depends on active traders, but research shows the more active traders are, the more money they lose. Likewise, the casino isn’t making much off the blackjack player who sits at the $5 table cadging free drinks, but it hopes the lure of easy money (and the lubrication of those free drinks) will loosen his pockets eventually.
Greater gambling access is becoming a trend. The illegal sports betting market, estimated at $150 billion a year, is rapidly moving to legal online forums. You can now place a sports bet from your couch in 20 states and counting, and mobile gambling apps are reaping the rewards. Since its SPAC listing in April 2020, DraftKings’ stock is up 160%. I don’t have a problem with this, as these firms state what they’re made for: gambling.
Another market that’s benefited from our insatiable appetite for risk? Crypto. Robinhood caught that trend early and introduced crypto trading to its platform in February 2018. Since then, the global crypto market has grown from $450 billion to $1.9 trillion. In the first three months of 2021, 6% of RH’s revenue came from Dogecoin trades. If that sounds like an unstable business model, trust your instincts.
Here’s what we’re saddled with: A trend of companies that prey on our financial naiveté, with no regard for law or morality and infinite amounts of capital. What can we do?
First, it’s long past time for the rule of law to reassert itself. Five years ago, admissions to elite universities were awash in bribery and fraud. Then the feds put some wealthy lawyers, investors, and television stars in jail. Did it work? I’d venture that if any parent receives an offer of a “side door” for their kid to get into an elite university today, the parent hangs up, crisply.
Second, we need to arm ourselves, and particularly our young people, with financial literacy. Everyone should be fluent in the basics of markets and how to build financial security. My NYU colleague Aswath Damodaran believes the best regulation is life lessons. Perhaps basic lessons in finance (e.g., not to trade on an app that harvests its orders for revenue) would lessen the pain of these lessons. If we can offer computer science and Mandarin in schools, we should offer courses in financial literacy. The English-as-a-second language course in any capitalist society ought to be in money.
…
We’ve implemented policies in the U.S. that have resulted in a halving of the wealth of Americans under the age of 40 (as a percentage of household wealth) over the past three decades. With so much less to lose, today’s young Americans are justifiably looking for new asset classes and embracing volatility. Put another way, there is cause for a rebellion. The food industrial complex wants you to be fat, social media wants you to be divided, and RH wants you to believe you can get rich quick by day trading. Rebel.
When the democratization of finance isn’t: “$HOOD.” Scott Galloway (@profgalloway) on the dangerously disingenuous Robinhood.
* Mark Twain
###
As we reconcile ourselves to the fact that if it seems to be too good to be true, it is, we might recall that it was on this date in 2018 that Apple became the first U.S.-based company with a $1 trillion market cap. Shares of Apple rose 2.9% on the day, closing at $207.39, giving the company a $1.002 trillion valuation. Shares of Apple’s stock were up about 40,000% since Apple computer’s IPO on December 12th, 1980.
Amazon broke the $1 trillion milestone a month later on September 4th, 2018. Microsoft reached the milestone nearly a year later, on April 25th, 2019.
You must be logged in to post a comment.