Tech Brew Ride Home - Fri. 01/31 - Did Uber and DoorDash Almost Merge?

Episode Date: January 31, 2020

Amazon earnings, the new Apple Maps is rolling out in the US, Uber and DoorDash held merger talks at Softbank’s behest, who’s number two to TikTok in short form videos, and of course, the weekend longreads suggestions. Sponsor: Metalab.co Links: Amazon Revenue Jumps on Holiday Sales as Profit Rises (WSJ) Apple's redesigned Maps app is available across the US (TechCrunch) Uber and DoorDash held merger talks after SoftBank push (Financial Times) SoftBank Is Funding Every Side of a Bruising Startup Battle (WSJ) EU lawmakers snub Apple's pleas, overwhelmingly vote to push for charging cable standard (Apple Insider) How Dubsmash revived itself as #2 to TikTok (TechCrunch) Weekend Longreads Suggestions: Every Company Will Be a Fintech Company (Angela Strange/A16Z) Don't Brush Off Mouth Tech As a Passing Fad (Wired) The iPad's original software designer and program lead look back on the device's first 10 years (InPut) Super Bowl 2020: The madness and magic behind the game’s first 4K HDR broadcast (Digital Trends) Researchers Are Racing to Make a Coronavirus Vaccine. Will It Help? (NYTimes) How Do Bats Live With So Many Viruses? (NYTimes) Facial Recognition- The controversial and nearly ever-present technology that could replace the fingerprint (California Sunday Magazine) CollegeHumor Helped Shape Online Comedy. What Went Wrong? (Wired) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech meme ride home for Friday, January 31st, 2020. I'm Brian McCullough. Today, Amazon earnings. The new Apple Maps are rolling out in the U.S. Uber and DoorDash held merger talks at SoftBanks behest, who's number two to TikTok and short form videos, and of course, the weekend long read suggestions. Here's what you missed today in the world of tech. Final earnings roundup of the week, Amazon's Q4 came in at 87.4 billion in revenue. up 21% year over year. Net income came in at 3.3 billion in revenue, but that was also up from $3 billion a year ago. What really matters the most for the stock, of course, is that AWS revenue

came in at $9.9 billion up from $7.4 billion a year ago. This news has buoyed Amazon's stock, and by trading up about 9% this morning, that means that Amazon's market cap is back above the magic $1 trillion mark. More details from Amazon on the earnings call, Jeff Bezos said Prime now has over 150 million members worldwide up from the 100 million that the company reported 21 months ago. And Amazon's other revenue category, which mostly consists of its advertising business, came in at $4.87 billion in revenue up 41% year over year. That means Amazon's ad business is growing faster than Facebook's is at the moment. Oh, and subscription services revenue was $5.24 billion, up 32% year-over year, so don't forget, Amazon's in that game, too. One interesting detail here from the Wall Street Journal.

Amazon's margins actually remained healthy, despite all that Ballyhood investment in one-day shipping and the like. There was investor concern that one-day shipping would be a drag-to- margins, so the fact that they have been able to offer one-day shipping and also at the same time drive some efficiency, has to please investors, Raymond James analyst Aaron Kessler said. The company's shipping costs rose to $12.88 billion, a 43% increase from a year earlier. Amazon's costs to build out one-day shipping capabilities have continued to surge as Amazon moves inventory closer to customers. One day spending reached more than $800 million from April to June and was expected to nearly double in the fourth quarter to $1.5 billion, end quote. An update to Apple Maps is rolling out across the U.S. with the promise of more detailed visuals and new features like Lookaround, which you can think of as Apple's version of Street View, but with high-resolution 3D images, quoting TechCrunch.

The updated Apple Maps includes Lookaround and Real-Time Transit in some markets, collections, favorites, a share ETA feature, flight status information for upcoming travel, indoor maps for malls and airports, natural language guidance and flyover, a feature offering immersive 3D views of major metros, as seen from above. The latter is available across more than 350 cities. Going forward, Apple will use the imagery it collects to deliver look around to more U.S. markets and begin to upgrade the maps platform in Europe, end quote. I did want to make note of this. Sources are telling the financial times that Uber and DoorDash held merger talks about six months ago at the urging of SoftBank, which invested in both startups and wanted to consolidate the food delivery industry. Indeed, the ruinous competition in the food delivery sector is why basically none of the players there can make any money. Of course,

one of the reasons there is so much competition in the delivery space is down to the fact that SoftBank has invested in so many players in this space. But hold that thought for just a second. The talks held roughly six months ago took place at the behest of the behest of the best of of Japan's SoftBank, a shareholder in both companies, through its $100 billion vision fund, these people added. While the merger discussions did not result in a deal, the two sides have not ruled out returning to negotiations or attempting to merge with a rival. DoorDash executives were cool towards the idea of a merger at the time, believing that their own food delivery service had stronger growth prospects than Uber service Uber Eats, end quote.

Now, back to the thought that maybe there are too many delivery players because SoftBank basically bankrolled them. I point you to a piece from the Wall Street Journal that outlines the bruising price war in Latin America between Uber, Didi, and Rappi, all of which were funded by, you guessed it, soft bank. Quote, Uber is under siege in Latin America amid a bruising price war where its ostensible rivals are Rappi and China's D.D. Shok Singh technology. But here's the twist. All the combatants have as their biggest owner the same tech investor, Japan's soft bank group, which has injected a total of $20 billion in the three. Startup investors typically don't back competing companies.

SoftBank, which runs the world's largest venture capital fund, has poured so much money into popular tech categories that it created a sort of circular firing squad in which soft bank companies use soft bank cash to attack one another. Former managers of all three delivery companies say they were frequently baffled by the amount of money that companies were willing to spend to compete. Uber, the only one of the three, to disclose financial results, Holtz lost $8.3 billion in the 12 months through September.

The soft bank funded fight is, quote, just bad business, said Chris Saka, founder of lowercase capital, an early investor in Uber. When an investor infuses multiple direct competitors with money to spend in a race to the bottom, it's just a waste, end quote. Yes, it's almost like Masasan just like spending money and maybe doesn't actually really have any plan behind it. The European Parliament has overwhelmingly passed a measure that calls for the adoption of a single common charging standard for mobile devices, something that Apple has argued strenuously against saying to do so with stifle innovation. The vote was 582 in favor and 40 opposed.

The measure claims to want to cut down on consumer confusion and frustration, but also to cut down on e-waste, quoting Apple Insider. Last week, Apple argued against the EU initiative saying a move towards a common charger would stifle innovation, and ironically, result in more e-waste as existing iOS device users transitioned to a standard like USBC. Quote, we believe regulation that forces conformity across the type of connector built into all smartphones, stifles innovation rather than encouraging it, and would harm consumers in Europe and the economy as a whole, Apple said in a statement. We hope the Commission will continue to seek a solution that does not restrict the industry's ability to innovate and bring exciting new technology to customers, end quote.

The European Parliament appears to directly address Apple's take in the resolution pass today, which reads, The use of wireless charging technology entails additional potential benefits such as mitigating e-waste, highlights that many mobile telephones already use wireless charging methods, and that fragmentation in this area should be avoided. Calls, therefore, on the Commission to take measures to best ensure the interoperability of different wireless chargers with different mobile radio equipment, end quote. Did you know, because I did not, that in the short form video market, there's a strong number two to TikTok's market leader. It's an app called Dobsmash, and it has one billion views a month, quoting TechCrunch. Now the app has pulled 27% of U.S. short form video market share by installs,

second only to TikTok's 59% according to App Annie. Sensor Tower, tells TechCrunch that TikTok has about three times as many U.S. Lifetime installs as Dub Smash and 11 times more between when musically became TikTok in August 2018 and now. In terms of active users outside of TikTok, Dobsmash has 73% of the U.S. market compared to just 23% on Triller, 3.6% on Firework, and an embarrassing 0% on Facebook's lasso. And while Triller began surpassing Dubsmash in downloads per month in October, Dub smash has three times as many active users and saw 38% more first-time downloads in 2018 than 2019. Dubsmash now sees 30% retention after a month and 30% of its daily users are creating content, end quote.

DupSmash is actually an interesting story because it debuted all the way back in the Vine era in 2015 and briefly soared to prominence before dropping off the map in terms of popularity, like happens to so many apps that you hear about and then quietly disappear. But instead of failing, into obscurity like so many other social apps, Berlin-based Dobsmash, just fired everyone when their numbers started to tank, moved from Berlin to Brooklyn, and used its leftover VC money to redesign its app and actually relaunched within two months of TikTok's rebranding. So Dobsmash has basically been able to draft in the slipstream of TikTok's popularity to regain popularity itself. Quote,

The turnaround that we executed hasn't been done in recent memory by a consumer app in such a competitive marketplace. Most of them fade to oblivion or shut down. Dub smash co-founder and president such a Dash told TechCrunch's Josh Constine. Dub smash is ground zero for culture creation in America. It's where the newest most popular hip-hop and dance challenges on the internet originate, Dash declares. Members of the community are developing content that will make them superstars of tomorrow, end quote. Time for the weekend long read suggestions. as I mentioned recently. Every so often, the folks at Andresen Horowitz post an essay that helps a lot of us frame

how to think about some corner of the tech world. Well, Angela Strange, a general partner at A16Z, has just posted such an essay with this thesis. Every company will soon be a fintech company. Quote, this same monumental change, infrastructure as a service is coming to financial services. and it's not just one company, it's multiple companies, because financial services infrastructure is so complex. This transformation will reduce the cost and complexity to become a financial services company, and importantly, it will unleash thousands of experiments that will pave the way for the future of banking. We would expect this innovation to come from startups and existing financial services institutions, but a large percentage of it will come from existing companies that are adding financial services for the very first time.

It's already happening. Apple just launched a credit card, end quote. I really, really want you to read this piece or even watch the accompanying video because we're going to be talking to Angela about this on this weekend's bonus episode. Next, as my experience at CES reinforced, you can basically put tech into anything these days, and a lot of times that's just a gimmick. But sometimes it can presage a for real revolution. People might rightly make jokes all. the time about $200 AI-powered toothbrushes, but Wired said, don't well brush off mouth tech. Quote, mouth tech, particularly in developed markets like the U.S. and Europe, is having a moment. And high-powered toothbrushes are just the tip of the dental pick. Consumer health companies are pitching portable water flossers, dental floss subscriptions, at-home LED whitening kits,

and direct-to-consumer smile aligners. The global oral care market is projected to grow to nearly $41 billion by 2025, up from 28, billion in 2017, according to Grandview Research. It's both a digital phenomenon. Our collective obsession with self-presentation has driven us to swipe and whiten our smiles before pressing send, and one in which the physical goods we buy to clean up our mouths every day are being upgraded with a dose of technology, end quote. We mentioned the 10th birthday of the iPad this week, and in honor of that, Input Magazine spoke with Imran Chaudry and Bethany Bongiorno about the that they played in the iPad's development. This is Bethany. Quote,

there were a lot of things that weren't working as we were building it that we completely threw out, fully implemented designs that we had started with to refine and redefine and redevelop as we were doing it. I definitely think there were some things that we felt were really important and some things even on the hardware side that we thought were really important that people ultimately didn't really use. And a lot of it, I think, was because it was a little bit too early, end quote. The big game is this weekend, apparently. It's a measure of how little I follow the NFL that I had to Google that date to make sure, and also to find out what teams are playing. What I was aware of is that for the first time, the event will be broadcast in 4K

HDR, and Digital Trends has a look at how that's happening. Quote, inside the Hard Rock Stadium are about 100 cameras, some high speed, some 4K, some 8K, some hung by wires high above the playing field, others in pylons staked at the end zones, all of them poised to capture every inch of action from every conceivable angle. The stadium has the infrastructure to support the cameras with untold miles of cabling leading from each camera station to a central junction box roughly the size of a shipping container. From there, Fox runs many more untold miles of cables to several of its production trucks. Some of these cables are roughly the circumference of a boa constrictor

that's just swallowed up a Florida gator. Everything about this seems huge, probably because it is. But it is inside the production trucks that the real heavy lifting and not just a little bit of magic happens, end quote. Then a couple things that aren't really tech, but science. The New York Times looks at the race to make a coronavirus vaccine. Apparently, they can now develop vaccines way quicker than ever before, but whether it will ever be fast enough to halt a disease when they need it is debatable. Quote, after the SARS outbreak in 2003, it took researchers about 20 months from the release of the viral genome to get a vaccine ready for human trials.

By the time an epidemic caused by the Zika virus occurred in 2015, researchers had brought the timeline down to six months. Now they hope the joint efforts will cut that time in half, end quote. And also from the times, and also on the coronavirus beat. Scientists think that the coronavirus jumped to humans from the bat population. It turns out that bats have a ton of viruses because weirdly they can live with a ton of viruses because they may have a unique immune system. Quote, their tolerance of viruses, which surpasses that of other mammals, is one of their many distinctions. qualities. They are the only flying mammals. They devour disease-carrying insects by the ton, and they are essential in the pollination of many fruits like bananas, avocados, and mangoes. They are also an

incredibly diverse group, making up about a quarter of all mammalian species. But their ability to coexist with viruses that can spill over to other animals, in particular humans, can have devastating consequences when we eat them, trade them in livestock markets, and invade their territory, end quote. Then, I know we've been talking about facial recognition a lot lately, but check out the long, long piece from the California Sunday magazine, because it's the best single piece that I've seen that explains how facial recognition tech actually works. And finally, college humor is one of those media properties on life support these days. after massive layoffs, after its parent company IAC said it wants to rid itself of the site.

Wired Magazine has a look at the whole history of college humor, the site that so many people grew up with, and whether or not it has a chance of survival. Like the best sketch comedy, it started with a simple premise and progressed unexpectedly from there. The idea, two 18-year-old best buds just want to make something new on the internet. We were just trying to start an online business, College Humor founder, Josh Abramson says, sipping an afternoon coffee at a New York cafe, remembering the beginning of his partnership with his childhood friend, Ricky Van Veen. The pair created a parent company called Connected Ventures in 1999,

but the pitch for what it actually did was not particularly fine-tuned. Someone told me, I founded a media business many years later, and I was like, what's that? End quote. So, yes, I hope to have that interview with Angela Strange for you tomorrow. However, as I record this right now, it is 3 p.m. Eastern on Friday, and we're not scheduled to record the episode until 6 p.m. Eastern tonight. This is the latest I've ever let it run to try to get a weekend interview out the door. And since it is late in the day on a Friday, there's always the chance that one of us will have to reschedule or something will go wrong. If that happens, I'll just reschedule and we'll push the episode to next weekend.

And by the way, ad-free subscribers, even if I do record tonight, you know how I usually get the weekend episodes out to you guys by 6 p.m. on Friday. Well, clearly that won't happen in this case. But assuming everything does go well, as soon as I record the interview, I will immediately edit it and post it. So if all things line up, you will have a great bonus episode in your hot little hands as anticipated. But as I said, this is the first time I have ever announced an episode without actually having recorded it yet. So please forgive me if something intervenes. Talk to you on Monday.