Marketing Report
Michiel Frackers: Apple scores with Messi

Michiel Frackers: Apple scores with Messi

This week there was no news that stood out everywhere, so I made a top 10 of things that caught my eye. The great little magician from Argentina is, of course, number one.

If Lionel Messi worked from home. Image: Midjourney

1. Apple scores with Messi

No one will have failed to notice that Lionel Messi has been playing for Inter Miami, the club owned by Posh Spice's husband, for a few weeks now. But there is another owner, Jorge Mas, and he was retweeted (or rex-ed, what's that actually called since Twitter was renamed X?) by Apple CEO Tim Cook this week. The occasion was the doubling of subscribers to MLS League Pass, the pay subscription Apple offers worldwide to people who want to watch the U.S. soccer league.

Neither Apple nor the MLS disclose how many subscribers the service has, although as recently as last month it was suggested that the number was close to 1 million, before Messi's arrival. In any case, Apple is clearly pleased with Messi's impact on MLS Season Pass, because that's not how often Tim Cook retweets/rex-ed messages from people outside Apple.

CNET analyzed Apple's strategy on streaming sports and is one of the first media outlets that seems to understand that the subscription to the MLS is an additional upsell; MLS matches and thus Messi's matches are not free for Apple TV+ subscribers. A monthly subscription to the MLS costs $12.99 or $49 for the rest of the season. It is extraordinary to read back now that as recently as April, there was laughter about the deal between Apple and the MLS.

Of course, it is odd that Messi is the only player in a team sport to benefit from the growth of subscribers to Apple TV+'s MLS subscription. The question is whether this will be replicated in other sports. Another question, of course, is how much Messi earns from each MLS subscriber and for how long; is it part of a subscriber's lifetime value or a flat fee per subscription?

There is plenty of speculation whether the Saudi league, which currently attracts any player who loves money, sand and shopping malls, will follow the same strategy as the MLS. That, of course, makes no sense: the MLS and its franchisees need money. The Saudis want to buy respect, charisma and reach and are even more likely to pay for worldwide broadcasts of their matches, rather than charge money for them.

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2. In Silicon Valley, everyone became Merlin the magician for a moment

'Forget AI. For a while, Silicon Valley was obsessed with floating bricks.' So headlined the Washington Post in a fine article about the craziness in recent weeks surrounding LK-99, the material hoped to be the room-temperature semiconductor that would change the entire world.

The article rightly states that the technology world is diligently looking for fundamental breakthroughs, such as AI, after a decade of few spectacular new applications became apparent. Hopefully, investment in companies working on carbon reduction and decarbonization will continue to increase.

Unfortunately, halfway through, the journalist briefly hits the mark: 'Cryptocurrencies and blockchain technology have been through several cycles of hype, but have yet to fundamentally change any sector except crime and money laundering. Technology designed to combat climate change, such as carbon capture and storage, has made no major progress for years.'

There is zero evidence that crime and money laundering have changed because of blockchain technology and cryptocurrencies. Zero. On the contrary: every transaction, while anonymous, is always visible on the blockchain, so the entire trail of transactions from a wallet is forever traceable to anyone on the Internet. Try that with the old-fashioned bank accounts through tax havens (Panama Papers, remember) or with the piles of cash of Pablo Escobar and consorts.

3. California is paradise and testing ground for self-driving cars

Following a state regulatory agency ruling, San Francisco will have robot cars on its streets 24/7. Good analysis explaining that this is a pivotal moment for the auto industry. Again from the Washington Post, which has excellent coverage of technology when you would rather expect that newspaper to focus on politics.

Once again, someone completely misses the point in this article, this time a mayor. " What will happen to our workforce if AI and driverless vehicles both come online at the same time? " she says. A bigger problem, of course, is that virtually no right-thinking person wants to be in politics by 2023, so we'll be stuck with mayors who talk about self-driving cars like retarded people talked about stagecoaches in 1910.

A populist politician's phony question has been the same for hundreds of years when confronted with innovations: 'But what will happen to the employment of the (choose your own preferred profession that no longer exists) chimney sweep/miner/video store worker?'

The answer is simple and has been the same for centuries: new occupations are emerging but hopefully advancing mechanization will eliminate heavy physical work and the work week can be further shortened to more time for fun things or self-development. There are people who got time to write a newsletter that way. No one benefits from further spreading the Chinese 9-9-6 culture: 9 to 9, 6 days a week.

The hope with self-driving cars, of course, is not that everyone will have their own self-driving car, but that transportation will be on demand; it is madness that the average car sits idle 95% of the time. Fewer cars means less CO2 emissions for car production and oh my goodness, this means unemployment for all the craftsmen in factories who currently screw antennas into the roofs of cars to receive FM radio.

4. Billionaires engaged in a race for and against AI

While technology experts are sounding the alarm about the pace at which artificial intelligence is evolving, philanthropists - including established foundations and technology billionaires - have responded with an increase in donations.

In the camp of the faithful include former Google top executive Eric Schmidt and founder of LinkedIn Reid Hoffman. In the other corner of the ring, for example, is Pierre Omidyar, founder of eBay, along with the Ford, MacArthur and Rockefeller Foundations. For those with doubts about this topic - and those doubts are very understandable and also justified - I again recommend this piece by Marc Andreessen. But AI and crypto are not scary, just as it was not scary that humans learned to read

The first half of this excellent podcast from colleagues of the aforementioned Marc Andreessen is about how AI could benefit from crypto, and the second half about how crypto could benefit from AI - but the common thread is the tension between centralization vs. decentralization.

This again touches on the point about whether cash or crypto is worse for crime: the arguments opponents use always end up with a centralized system, without actually analyzing the problem.

The podcast also discusses where the intersection of crypto and AI can bring about things that are not possible by either alone. Together, the fields of AI and crypto have major implications for how we live our lives every day; so this episode is for anyone curious, or already building in this sector.

5. PayPal with its own stablecoin

PayPal came out with its own crypto currency that is pegged in value to the dollar. From a financial standpoint, using stablecoins is not much different from using a gift card: you can use your dollars to buy stablecoins and then use those stablecoins to buy various cryptocurrencies or make other online purchases.

Downright funny was to see the reactions. Some think the PayPal stablecoin is more important than a Bitcoin ETF arguing that PayPal is uniquely positioned to solve the huge opportunity for fiat onboarding - they have the banking relationships, regulatory framework and infrastructure to sign up millions of dollars to millions of wallets. Thestreet.com even calls PayPal the crypto leader for the next decade because it links 400 million customers to crypto. The question, of course, is how many of those 400 million ever use crypto. Those 400 million customers also have access to stamps, and how often does anyone moisten the back of such a sticky note?

PayPal's stablecoin is totally unimportant, says Bank of America but that name alone does not have the aura of total neutrality on this topic. He is often quoted in this newsletter and once again Michael Casey of Coindesk has the most thorough analysis: why the timing feels right.

I expect there will be great resistance from Washington to the PayPal stablecoin, because anything pegged to the dollar is, in the eyes of the average bureaucrat, not owned by the citizen, but by the state.

6. Worldcoin under increasing pressure

Speaking of citizen ownership, whose is identity? I've written about Worldcoin before because I think the idea of an anonymized affirmation of a human identity is important and fully endorsed. There is so much unnecessary fraud and deception on the Internet that an anonymized digital identity and reputation can be crucial. Suppose you buy something on eBay from someone who has done few transactions there but has an immaculate reputation on Etsy, Uber or on Airbnb, for example; then confirmation of such a good "portable" reputation would be extremely valuable for buyer and seller.

What Worldcoin is doing now is linking a human identity to an iris scan in exchange for obtaining free Worldcoin tokens. There is no useful application whatsoever as I describe above. It leads to harrowing scenes worldwide, such as in Kenya: 'Some people in line told local media they had traveled miles after friends said "free money" was being handed out. They admitted they didn't know why they had to scan their irises and where that information would go, but they just wanted the money.'

Surely someone with the intelligence of Sam Altman, the former top executive of business factory Y Combinator and founder of Open AI, should be able to couple that intelligence with the common sense to not want to do this with Worldcoin?

7. Nvidia gets $5 billion in orders from China

In June, I wrote that Nvidia's Keith Strier told the ATX Summit in Singapore that Nvidia has more orders than it can deliver, and that companies and even countries have been placing orders years in advance to ensure longer-term deliveries. Strier wrote about it himself:

''This is about compute, not just chips. AI requires a highly specialized compute infrastructure, a combination of hardware and software. Most importantly, the supply is finite. [...] NVIDIA GPUs (the chips, MF) are more than gold, they are the "rare earth elements" of AI. That is why the world's most advanced AI companies are raising capital to secure the supply of accelerated computing. Whether an enterprise or even a country, it is important to plan and budget for the computing power that will be needed to achieve and sustain leadership in AI.''

Strier was referring to this order, among others, as Baidu, Tencent, Alibaba and ByteDance (owner of TikTok and Lemon8) ordered for $5 billion, including $1 billion this year and $4 billion in 2024. There are countries and companies already trying to place orders with Nvidia for 2025 through 2028.

The Chinese companies are playing catch-up and are pulling out all the stops to continue their "old-fashioned" growth. ByteDance is trying to link TikTok with Lemon8 in an effort to boost usage of that app, and Alibaba, which along with Tencent Holdings and Baidu is responsible for the birth of China's Internet industry, is trying to persuade investors to support the policy of splitting the company into no less than six parts.

8. WeWork doesn't work, Zoom just does

Interest in WeWork has always completely passed me by; it always seemed like overpriced office space with moderately comfortable furniture. The absurd valuation to value a real estate marquee as a technology company came to a screeching halt around the failed IPO, and now the board is reporting, in part due to increased interest rates, that a bankruptcy of WeWork is not ruled out.

Meanwhile, Zoom is asking staff who live within 80 kilometers of the office to come to the office at least two days a week. A reasoned request, interpreted by the media as the end of working from home. It seems like some journalists don't speak to people; I hardly know anyone who works in an organization where working from home is possible, where the pre-pandemic work culture has been restored. It won't be every day, but working from home has become part of working.

9. The investor is on vacation

Despite the billion-dollar order from China, Nvidia was the week's decliner, but that's not surprising after all the gains this year so far. Otherwise, it was doom and gloom for tech companies, so I thought it would be nice to look at what's happening at companies in the pre-IPO stage. This article on crowdfunding in Europe illustrates the increased interest in climate tech, in technology that combats climate change.

With the stock market climate continuing to allow few major IPOs in the coming months, it is especially interesting to follow which companies are being acquired rather than going public. With every company where a buyer knocks on the door, mild panic ensues. Therefore, this is an excellent article, explaining the steps to follow the moment a buyer comes forward.

10. A Steph Curry summer

Speaking of vacations; the summer hit of 2023 is obviously Roxy with "Anne-Fleur Vacation," but the one with the most extraordinary summer is undeniably basketball player Steph Curry. First he hit a hole in one at a charity tournament and last week he was on stage at his own Chase Center in San Francisco with the band Paramore. And the conclusion was: what a basketball this man can play.

Wishing all readers another Steph Curry summer, see you next week!

 

Michiel Frackers is Chairman of Bluenote and Chairman of Blue City Solutions

www.bluenote.world
www.bluecity.solutions


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Read also:

Michiel Frackers: The new Internet hype is ... LK-99, a superconducting material?

Michiel Frackers: Worldcoin proves: people give away their eyeballs for a few coins

Michiel Frackers: The journalist who became a billionaire as an investor, quits

 

 

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