Tech Brew Ride Home - Fri. 02/07 - Uber Can See The Promised Land

Starting point is 00:00:00 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 right home for Friday, February 7th, 2020. I'm Brian McCullough. Today, Uber says it will be profitable quicker than it had expected to be. Yet another entrant into the lists at the streaming wars. What's it like to use a 64 core processor? And of course, the weekend long read suggestions. Here's what you miss today in the world of tech. So I was completely wrong yesterday when I said that earnings season was over. I forgot that Uber and Lyft tend to make up the caboose on the tech earnings train. Uber is up over 9% at the time of this writing after reporting Q4 revenue of $4.1 billion up 37% year over year. Gross bookings came in at $18.1 billion,

Starting point is 00:01:24 up 28% year over year, but the net losses still came in at $1.1 billion. The stock is up because Uber's CEO, Darikoswashiahi, moved up Uber's profitability target to the fourth quarter of this year. The company had previously expected to break into the black by the end of next year, 2021. The secret here is that Uber is apparently telegraphing accelerating revenue growth, quoting Sanbici. In Notes Friday morning, analysts highlighted the new EBITDA profitability target with many putting a buy or outperform rating on the stock. Analysts at MKM Partners who upgraded the stock to a buy rating and moved their price target from $34 to $45, wrote that incremental margins on rides revenue have contributed to the accelerated profitability target.

Starting point is 00:02:15 To date, we think Uber was being valued as if it is going out of business, either due to ongoing cash burn or due to regulatory environment, the analyst wrote. In our view, the trend line from the past couple of quarters provides a firm valuation floor on Uber's shares. This should help with lingering negative sentiment-related. to unclear regulatory environment, end quote. Worth noting also that gross bookings from Uber Eats were $4.37 billion up 71% year over year, which is confusing to me because I feel like we keep getting mixed signals about whether or not Uber Eats is a good business for Uber or not.

Starting point is 00:02:52 It also seems I spoke too soon when I said a while ago that we've seen all of the entrance into the streaming wars contest. sources are telling CNBC that Viacom CBS is building a new ad-supported streaming service that will build on CBS All Access. Its existing video streaming service, quoting CNBC, while Viacom CBS executives haven't made any firm decisions, they are considering creating a service with advertisements that will combine CBS All Access with Viacom assets, including Pluto TV, Nickelodeon, BET, MTV, Comedy Central, and Paramount Pictures, said the people who asked not to be named because the product discussions are private. An ad-free version will also be available and a premium version of the streaming service will include Showtime, the people said.

Starting point is 00:03:44 Viacom's CBS executives haven't decided on a name for the service nor a price, though the base service will probably be less than $10 a month, two of the people said, end quote. Yay, another one. As Alex Zalban tweeted, quote, what if, and hear me out, they made it possible to watch all these streaming services on a large box in your living room, and you could flip between them using some sort of remote control, end quote. Real quick follow-up, New York Stock Exchange owner Intercontinental Exchange has abandoned its plans to purchase eBay because their shareholders revolted, quoting the Wall Street Journal. Intercontinental Exchange, or ICE said in a statement

Starting point is 00:04:32 released after markets closed Thursday, that it was giving up on its consideration of strategic opportunities with eBay based on conversations with investors after its morning earnings call. The move followed a sharp decline in ICE shares after the Wall Street Journal reported Tuesday that the company had made an overture to eBay that could result in a takeover bid worth more than $30 billion. Ice shares dropped 7.5% that day and almost another 3% Thursday as investors voted against the idea by selling their shares. The drop in the exchange operator's stock has wiped out more than $5 billion in market value, end quote. I feel like it's been ages since I did a review segment. So how about this? What would it be like to use one of those new AMD Threadripper 3990X

Starting point is 00:05:21 CPUs, the ones that come with 64 cores? Well, Anand Tech has you covered with one of their typically detailed reviews, and their verdict is these new chips are great for rendering and scientific computing, but it turns out to have basically the same performance as AMD's 32-core CPUs if you're doing normal applications. Quote, not everyone needs 64 cores, and AMD has been very clear about this in their messaging, even though the 3990X is part of AMD's high-end desktop line. Because it's breaking new ground in core count and price, it sort of goes beyond the high-end, essentially eclipsing the prosumer server market.

Starting point is 00:06:03 This means users and companies that can amortize and justify the cost of hardware as it enables them to complete projects and therefore contracts faster. For a user that needs to create something rather than doing 25 prototypes a week, doing 100 per week makes their workflow a lot more complete, and it's this sort of user AMD is going for. On the consumer prosumer level, our conclusion is that the usefulness of the 3990X is limited. Aside from a few select instances, the 32 core thread ripper, for half the price performed on par with margin. For this market, saving that $2,000 between the 64 core and the 32 core can easily net another RTX 2080TI for GPU acceleration, and this would probably be the preferred option. Unless you run those specific tests or ones like it, then go for the 32 core and spend the money elsewhere.

Starting point is 00:06:55 Aside from the core count, there's little to differentiate the two parts. On the enterprise level, it becomes a no-brainer to consolidate a dual. socket system into a single AMD CPU. The initial outlight cost is substantially lower, and the long-term power costs also come into play. This is what the enterprise likes to combine into total cost of ownership or TCO. The TCO and performance advantage of AMD here is plain to see in the benchmarks and the pricing, end quote. I'm neither here nor there on this, but RECode took a look at who workers at big tech companies, in this case, Amazon Apple, Facebook, Google, and Twitter are contributing to in this presidential election year.

Starting point is 00:07:43 According to election funding records, the number one candidate of big tech workers is Bernie Sanders, who got $270,000 in contributions. Sanders was the number one candidate in terms of dollar figures for all five companies, except Facebook, where Yang came in number one. Yes, Andrew Yang comes in number two overall, not far behind Sanders, with $230,000, in contributions, followed by Elizabeth Warren, then Pete Buttigieg, and actually way back in the pack is Joe Biden with only $41,626 in contributions, although he was the third most popular candidate by dollar figure at Amazon. President Trump only received $14,628 in contributions from workers

Starting point is 00:08:27 at these five companies. As Recode puts it, quote, All told the new data shows how the rank and file at big tech companies are rallying behind some of the candidates who are the least friendly to big tech and the current system of capitalism more broadly. Sanders, an avowed Democratic Socialist, emerged in the last three months of the year as one of the campaign's frontrunners and is now, for the first time, outraising other candidates with small donations from these tech employees and others. Warren has been the most explicit and aggressive about her plans to break up big tech companies, although she also has surprisingly strong support from Silicon Valley elites and tech employees. A dozen employees of these companies cut max out checks of $2,800 to Warren's campaign, including eight from Google, end quote.

Starting point is 00:09:16 Good news going into the weekend. Netflix says users can now turn off that autoplay preview feature on the Netflix homepage. You know, when you just want to search around for something new to watch, but if you tiptoe too loudly past the homepage, you wake the beast and Netflix starts blaring a video trailer at you. So yeah, after years of begging for it, Netflix has finally listened to us and given us the option of disabling that feature. Here's how you do it. Sign into Netflix from a web browser, select manage profiles from the menu, select the profile you'd like to update, and then check or unchecked the option to autoplay previews while browsing on all devices. You can actually also turn off the autoplay next episode in a series function, which I actually find quite useful. But if you wanted to turn that off, you've actually been able to do that for a while now.

Starting point is 00:10:11 You do that by signing into Netflix from a web browser again, selecting managed profiles from the menu, selecting the profile you'd like to update, and then check or uncheck the options to auto play next episode and a series on all devices. News you can use. Thinking of relaxing with Netflix, makes me think of the weekend. Time for the weekend long-rate suggestions then. First up, I covered Jeff Wiener's stepping down as CEO of Ler. LinkedIn this week, but I didn't tell you that there was a whole org chart shuffling that went on at Microsoft this week that saw Chief Product Officer Penes-Penay taking on a bigger role by leading

Starting point is 00:10:52 a new single group, which is combining the Windows Experience team and the Microsoft hardware team into a group called Windows Plus devices. As Tom Warren points out in The Verge, this is a significant change for Microsoft because it means the future of Windows is now tied directly to Microsoft. own hardware efforts. Quote, Windows is certainly at a crossroads right now, as Microsoft increasingly looks to the web and the cloud. It feels like its operating system is no longer as important for the company. Microsoft CEO Sachin Adela has pondered branding Windows as Azure Edge and said at the launch of the Surface Duo, running Android by the way, that the operating system is no longer the most important layer for us, end quote. He's certainly looking in a logical

Starting point is 00:11:38 direction for Microsoft's future growth, but as Windows 10 approaches a billion users, it's still hugely important to many that rely on it every day, end quote. To serve that base, Microsoft increasingly feels that it needs to control the whole widget. Who does that remind you of? Next, new newsletter alert. This time, it's Stephen Levy at Wired. Stephen is the reigning dean of the tech reporting crew, so anything from him is worth subscribing to. The newsletter is called plain text, and in its second issue, he makes the interesting argument that all of these tech companies reaching trillion dollar market caps maybe should not be celebrating. He says when you reach that size, quote, you don't disrupt. You get disrupted. Protecting the revenue stream that made you the trillion

Starting point is 00:12:26 dollars is critical, but doing so only translates into success in the current marketplace. Whatever the future marketplace is, you're not making your money there. One workaround for a huge company is to use its cash to buy upstart competitors. With antitrust scrutiny on the rise, that approach might lose some luster. In the best case, the trillionaires will be lumbering dinosaurs, slow-moving targets for rising innovators, innovators who aren't worried about maintaining a constant waterfall of revenues just to prop up a gargantuan stock price, end quote. Classic innovators dilemma stuff there, where your size, buy it. itself becomes the albatross that boxes you in and actively prevents you from being as

Starting point is 00:13:05 competitive as you need to be to torture a bunch of metaphors there. Next, the New York Times takes a look at the algorithms in the U.S. and Europe that are increasingly being used to make probation decisions, doing things like predicting whether teens will commit crimes or who's available for welfare payments. We're talking actual precog minority report level stuff here. But it's not all Cassandra slash Luddite sky is falling stuff in the article. I found this point interesting. Quote, various algorithms embraced by the Philadelphia criminal justice system were designed by Richard Burke, a professor of criminology and statistics at Penn. These algorithms do not use zip codes or other location data that could be a proxy for race, he said. And though he acknowledges

Starting point is 00:13:50 that a layperson couldn't easily understand the algorithm's decisions, he said human judgment has the same problem. Quote, all machine learning algorithms are black boxes, but the human brain is also a black box, Dr. Burke said. If a judge decides they're going to put you away for 20 years, that is a black box, end quote. And it's been a common thread for 20 years now. A platform comes into a market, overlays itself on top of it, claiming to make that market more efficient, lowering frictions and costs and the like. But what the platforms often end up doing, is merely squeezing margins and rents out of the existing players in the market. Vice wonders if that is exactly what ClassPass is doing to the fitness industry.

Starting point is 00:14:35 Quote, Class Pass is squeezing studios to the point of death, one New York studio owner said. It's really serious, said another. It's very, very hard for a single location studio like ourselves to frankly almost keep our doors open. According to interviews with 18 current and former Class Pass partners, the company has stripped control of studios from their owners and instituted an algorithm-based model they don't trust, which drives per-student payments as low as $7, far below what some studio owners see as sustainable, end quote. I didn't cover the whole Elon Musk Cave Explorer Thailand legal case because I thought it was a bit too soap opera-e for this show. But Ryan Mack did.

Starting point is 00:15:19 He actually attended the trial. so if you're interested in how it all went down and it turned out, check out his piece from BuzzFeed News. And finally, Bloomberg has another look at a small rocket maker that it says is running a different kind of space race. The company is Astra Rocket. Quote, the company's founders say they want to be the FedEx of space. They're aiming to create small, cheap rockets that can be mass produced to facilitate daily space flights, delivering satellites into low Earth orbit for as little as a million dollars per launch. If Astros planned, Codiac flight succeeds on February 21st, it will have put a rocket into orbit at a record-setting pace.

Starting point is 00:16:00 Chief Executive Officer Chris Kemp says he's focused less on this particular launch than on the logistics of creating many more rockets. Quote, we have taken a much broader look at how we scale the business, he says, end quote. I didn't think this warranted its own entire segment, but word came down today that Apple, Microsoft, Alphabet, Amazon, and Facebook, just those five companies account for around 18% of the S&P 500 index by market value. Again, it's not that tech as an industry overall makes up 18% of the S&P by value. It's that those five tech companies do all by their lonesome. Not sure what to say about that, because in a way, it's not that surprising these days, but there you go. Hey, no weekend bonus episode this weekend.

Starting point is 00:16:55 I'm just going to take this one off. Talk to you on Monday.

Tech Brew Ride Home - Fri. 02/07 - Uber Can See The Promised Land

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