Business – Page 23

「Video of the Week」Talk with Boeing CEO Dennis Muilenburg

The David Rubenstein Show in August 2018, when Boeing’s share price is ~$350.

https://www.bloomberg.com/news/videos/2018-08-08/the-david-rubenstein-show-dennis-muilenburg-video

JPM Coin…

So JP Morgan has created its coin… JPM Coin

Three early applications:

Cross-border payments. The cryptocurrency will enable Chase to settle international payments between clients in real-time, and at any time of day (which does not happen today).
Securities transactions. Rather than relying on wires to buy a debt issuance–which would create a time gap between when a transaction settles and when investors get paid–institutional investors can use the token to generate instant settlements.
Transaction consolidation. Clients of J.P Morgan’s treasury services business will be able to replace the dollars they hold in subsidiaries across the world, enabling them to move money to subsidiaries around the world with greater fluidity.

“The JPM Coin will be issued on Quorum Blockchain and subsequently extended to other platforms. JPM Coin will be operable on all standard Blockchain networks.” — JPM

Here is what others are saying/reporting…

“In trials set to start in a few months, a tiny fraction of that will happen over something called “JPM Coin,” the digital token created by engineers at the New York-based bank to instantly settle payments between clients.” — CNBC

“For years, Chase–by itself and with the other big banks–has invested in reducing its reliance on legacy payments networks. Coin, like previous endeavors such as clearXchange, appears to be another example of that strategy to directly control the manner and method by which payments activities flow. If successful, Coin and the Chase Quorum blockchain could find many other uses.” — Charles Potts, Managing Director, First Performance

“It’s a competitive approach by Jamie Dimon to compete directly with Western Union in the $600 billion remittance market where Chase holds the #2 spot and Bank of America is on their heels. Ripple has done all the hard work by paving the way for a blockchain coin network. Our US payment systems are proprietary and not interoperable–the only way to seriously compete is a syndicate like Early Warning with Zelle and The Clearinghouse.” — Travis Dulaney, CEO, PayFi

“It’s an ecosystem play pure and simple. It’s about reducing costs and securing market share.” — Bradley Leimer, Co-Founder, Unconventional Ventures

“It really isn’t an ‘end run’–it’s more like creating a whole new playing field. It’s an acceleration of the continuing erosion of money fiefdoms. Due to margin pressures, money movement will eventually become a free utility. What the JPM Coin starts to enable is the elimination of the payment rails–which is really just a connection of ledgers–because with blockchain, there’s just one ledger. Once you have that shared ledger, the applications go beyond institutional payments to any payment type like remittances.” — James Wester, Research Director, Worldwide Blockchain Strategies, IDC

“The bank is also running a blockchain payments trial launched in conjunction with Australia’s ANZ and the Royal Bank of Canada. As reported, the three banks set up the project in October 2017, aiming to slash both the time and costs required for interbank payments using traditional methods. Called the Interbank Information Network (IIN), the platform is also built on Quorum – which itself may eventually be spun off into its own enterprise.” — CoinDesk

A data/IT system named with “coin”

Think about Gold and US Dollar in the history – Congress acted on Hamilton’s recommendations in the Coinage Act of 1792, which established the dollar as the basic unit of account for the United States; 1900, with the passage of the Gold Standard Act, US government guaranteed the dollar as convertible to gold

Smart Building (1): Data + Management Startups Roundup

Smart building is a hot topic and will be at the center of future real estate, a $217 trillion giant industry.

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So what is the core segments of smart building? This blog will provide a roundup of startups in the data + management space.

Comfy (developed by Building Robotics)

Probably most famous for its collaboration with WeWork in 2016, Comfy is an app that lets users to adjust the temperature, lights etc. in the office from smartphones.

Euclid

Euclid is a leading spatial-analytics platform based in San Francisco. With fundings from NEA, Benchmark and other investors, It has built a proprietary analytic offering that uses WiFi signals to understand how space is used without the installation of any additional hardware. It can track the identity and behavior of people in the physical world.

A retailer application of Eculid’s technology | Source: marketingland.com

In Feb 2019 (a few days ago), Euclid was acquired by WeWork (“The We Company”). The blog post from The We Company.

Teem

A maker of office management software, Teem was acquired by WeWork in Sep 2018 for around $100 million. Teem has grown from a conference room management tool to include office space management, (office) room display, visitor management, etc.

BuildingIQ

An energy-efficiency focused startup, BuildingIQ listed on Australian Securities Exchang and raised A$20 million in 2015, with an IPO marketcap of A$85 million.

Back in 2013, it raised $9 million from Aster Capital (backed by Schneider
Electric, Alstom and Solvay), the Venture Capital unit of Siemens Financial Services (SFS VC) and Paladin Capital.

BuildingIQ Mobile App | Source: buildingiq.com/app

Flywheel

Formerly known as SCIenergy, Flywheel is a maintenance (task) & energy management startup based in Dallas. Invested by DFJ, Flywheel raised its latest round in 2014 by a group of energy focused funds, led by Braemar Energy Ventures and joined by the Westly Group and others.

Consolidation is coming faster than most could imagine…

Apparel Comparables

Fast Food Comparables

with Yahoo Finance and Google Sheet…

And fast food companies can be such profitable

Apple’s Service Bundle

Apple may know well before the investors that their flagship iPhone would face a slowdown and it needs new growth strategies.

Apple has talked about its services for a while and it’s not limited to Apple Care or Genius Bar (“Physical Services”), but more about Distribution Services.

System/Platform Level

I guess the most obvious change happened in 2016 when a new revenue sharing scheme was introduced by Apple – from a 30% cut to a 15%-cut-after-first-year. And other features were included such as “subscription group“… marching into subscription-based services revenue model.

85% net revenue after first year | Source: verge.com

Apple News

Available in Australia, UK, and US, it’s currently a curated display place for publisher subscriptions. It could be developed into a Toutiao-like app for personalization and could be complimentary with Apple’s Stock app.

And it won’t be surprised to me that in the future you can trade stocks through this app – probably by upgrading to a premium version with other complementary benefits (like news/reports).

Apple Music

Anyway, music is where Apple found its turnaround with iTunes and iPod. Plus, it is the most explored region with established companies and new entrants.

Spotify Premium – $9.99 / month

YouTube Music – $9.99/month

Pandora Plus – $4.99/month & Premium – $9.99/month

Apple TV & Streaming Channel

Apple has long reported to be interested in contents distribution especially video. And rumors about an acquisition of Netflix didn’t come from nowhere.

A New York Times report back in March 2018.

A CNBC report in October 2018 – Apple plans to give away original content for free to device owners as part of new digital TV strategy.

Apple has cash and ability for original contents (and can acquire/build a studio). Apple has educated customer base (thanks for Netflix). Apple has introduced Clip for iOS short videos (think about Snapchat and Douyin, plus its ability in music and messaging). Apple has AppleTV and AirPlay.

There are just too many things to do in this space, broadly speaking.

And the competition is fierce. Netflix, Amazon Prime Video, Youtube TV, Facebook/Instagram TV, Disney/Hulu, AT&T/HBO…

And the AR/VR future…

Let’s see.

Gaming

It might be something new. But Apple could introduce a monthly plan to play most iOS games freely (with some exceptions maybe). Just like what Tencent did with WeChat Read – subscriptions that can read all books on its app.

Let’s see what Steam will do… Steam has subscription-based products, although not a bundle.

A master bundle plan for Apple users in the future? Possible.

India E-commerce Chaos and Complexity

The New E-commerce Regulation in India – Be a participant or an organizer, not both

Starting from February 1, 2019, Amazon India and Flipkart by Walmart, among others, are not allowed to hold inventory and sell to customers.

The rules now bar any entity in which an e-commerce firm or its group companies have a stake from selling on their online platform. This is a problem for Amazon, which had been picking up stakes in offline Indian retailers to boost its market share. (Reuters)

The Regulation In Four Dimensions

eCommerce in India can be broadly categorized as:

domestic and cross-border
B2B and B2C
marketplace and inventory based
single brand and multi brand

B2B: 100 percent FDI is allowed in companies engaged in B2B eCommerce, e.g. Walmart and Alibaba can operate a cash & carry (B2B) business.

B2C Marketplace: 100 percent FDI is allowed in the online retail of multi-brand goods and services B2C under the marketplace model, e.g. Amazon, Flipkart, Snapdeal. Any eCommerce entity providing a marketplace cannot exercise ownership over the inventory and is not permitted to sell more than 25 percent of total sales through its marketplace from one vendor to their group companies. There are also conditions restricting to offer discounts by marketplace.

B2C Inventory-Based: FDI is not allowed in inventory-based model of eCommerce.

Single Brand: A single brand retail trading entity operating through brick and mortar stores is permitted to undertake retail trading through eCommerce subject to local sourcing requirements. Food retail: 100 percent FDI is allowed for trading (including eCommerce) of food products manufactured or procured in India.

Multi-Brand Retail: No FDI is allowed in companies which engage in multi-brand retail trading by means of eCommerce.

Source: https://www.export.gov/article?id=India-e-Commerce

Other Conditions

E-commerce marketplace may provide support services to sellers in respect of warehousing, logistics, order fulfillment, call centre, payment collection and other services.
An e-commerce entity will not permit more than 25% of the sales value on financial year basis affected through its marketplace from one vendor or their group companies.
In marketplace model, any warrantee/ guarantee of goods and services sold will be responsibility of the seller.
E-commerce entities providing marketplace will not directly or indirectly influence the sale price of goods or services and shall maintain level playing field.
The government has also prohibited e-commerce firms from pushing merchants to sell any product exclusively on its platform. The sellers can, however, choose to have a preferred online partner.

Source: https://dipp.gov.in/sites/default/files/CFPC_2017_FINAL_RELEASED_28.8.17.pdf

Some Context

Indian marketplace is dominated with many small shops and business. If foreign investment in multi-brand retail is to be permitted, then the business of these small shop owners will be in danger. Consumers will be spoilt with choices and due to high competitions, prices will go down, thus these multi-brand retail establishment will be able attract consumers at a large scale. However, in case of single-brand retail shops, they usually bring premium or luxury goods in the market so as such they are not in direct conflict with Indian small business. (blog.ipleaders.in)

「Podcast of the Week」Restaurant and Food – Not Easy Business

Two Bloomberg interviews…

Tencent vs. Toutiao and Tencent’s Core Asset

Just two days ago, one of the most popular growing app China “Douyin/Tiktok” (owned by ByteDance, formerly known as Toutiao) was founded to be blocked to login with WeChat (owned by Tencent) for new users.

The two old king in social apps is fighting the rising new star.

In March 2018, WeChat global MAUs surpassed 1 billion.

Douyin said its global MAUs is over 500 million in July 2018.

Tencent’s WeChat has been on the market way earlier (since 2011). Douyin was launched in Sep 2016 but its growth has been so terrifying that Tencent has adopted several defensive actions, including blocking sharing Douyin links in WeChat.

Tencent has also backed Qutoutiao to combat with Jinri Toutiao (Toutiao’s flagship and first product) and Weishi for Douyin.

Now the war has escalated. Toutiao launched a new social app “Duoshan” to challenge the King and Tencent blocked WeChat login for Douyin.

Things are just getting started. But it reminded me of the 3Q war in 2010 between Tencent and Qihu360. Tencent didn’t have WeChat yet and relied on its QQ platform (the previous King).

Tencent vs. Qihu360 | Source: tech.sina.com.cn

During the war, one particular action by Qihu was seen by Pony Ma (Tencent founder and CEO) as the most threatening and he forced users to log off QQ if they don’t uninstall Qihu.

The key in that situation and in Ma’s mind is the copy of social map. The full connections between almost every relevent Chinese internet user.

This is probably what Ma values most and is one of Tencent’s core secrets.

That is what Toutiao is trying to obtain with Duoshan and Douyin today ina different way than Qihu) – the social map of almost every relevant Chinese (young) mobile users. And those would be the future Chinese internet revenue sources/assets/reserves.

The war will continue to unfold and Toutiao is much more powerful than Qihu. Toutiao is one of the most valued private companies in the world, but it is also taking on Baidu for news feeds and ads – multi-battleground just like Uber.