Tech Brew Ride Home - Fri. 10/09 – FTC Sues To Block The Microsoft/Activision Deal

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 Beam Right Home for Friday, December 9th, 2020. I'm Brian McCullough today. This is going to make the situation in the gaming industry downright chaotic. The FTC has sued to block Microsoft's $69 billion Activision Blizzard acquisition.

Starting point is 00:00:48 Sam Bankman-Fried says he's going to testify under oath before Congress, why the salute emoji is hands down the symbol of the year 2022. And of course, the weekend long-read suggestions. Here's what you miss today in the world of tech. Well, this is really, really. throwing the chess board up in the air. The FTC is officially suing to block Microsoft's $69 billion Activision Blizzard acquisition, charging that the deal announced back in January may suppress Microsoft's gaming competitors, quoting the Washington Post. The Federal Trade Commission on Thursday took its most

Starting point is 00:01:24 aggressive actions since Lena Khan became chair to rein in the power of big tech. Pursuing a lawsuit to block Microsoft's acquisition of a game developer on the same day, it opened arguments in another case against meta's purchase of a virtual reality startup. In both cases, the FTC argued that the acquisitions would squash future innovation in emerging gaming markets, a relatively novel interpretation of antitrust law that Khan and her allies have championed as they seek to usher in an era of competition enforcement. The complaints follow long-running criticism that federal regulators have not been forward-looking enough in evaluating deals in Silicon Valley, allowing tech titans to dominate by gobbling up their much smaller rivals. The FTC's suit against Microsoft would block the company's $69 billion

Starting point is 00:02:08 acquisition of the video game publisher Activision Blizzard. Charging that, the deal would allow the Redmond Washington Tech Giant to suppress its competitors in gaming. If the FTC's lawsuit prevails, it would foil Microsoft's ambitions to become a heavier hitter in the gaming industry. Activision is the owner of popular titles such as Candy Crush and Call of Duty, and its acquisition could bolster Microsoft in its competition with Japanese console makers, Nintendo, and Sony. Shortly after the commission took action in Washington on a three-to-one party line vote to sue Microsoft lawyers for the FTC in San Jose argued that Facebook parent company meta is squashing competition in the niche market of virtual reality-powered fitness apps by buying the maker of the popular VR workout game Supernatural. The case comes as enforcers have signaled during the Biden administration that they plan to more frequently bring long-shot cases against companies to court even when there's a risk they could lose. The joint actions signal that the newly empowered Democrats at the FTC are starting to unleash an agenda that could have far-reaching consequences for the world's most powerful tech companies following months of partisan gridlock that blunted Khan's ambitions.

Starting point is 00:03:15 If the FTC is successful, it will be a major blow to the biggest attempted deal in gaming history. And the suit itself is another clear signal from the agency that any big tech company looking to buy a smaller one should be wary, end quote. Key detail from this piece, though, quoting again, the agency is not seeking a preliminary injunction to stop the deal from closing, so the two parties are still likely to close, end quote. And then quoting Tim Basinger on Twitter. A bit more context on this. As with the MGM Amazon merger, the FTC did not approve that merger, but let the deadline pass. It has the authority if it wants to try to block mergers after they close, end quote. Putting this on your radar so you can stock up on popcorn, I guess. Sam Bankman-Fried has agreed to

Starting point is 00:04:06 testify before a House committee on December 13th, but has remained quiet about a request from a Senate committee which could issue a subpoena, quoting CNBC. There's been a lot of back and forth in Washington over whether lawmakers would have to subpoena Bankman-Freed, who said he would voluntarily testify since the committee, quote, still thinks it would be useful, end quote. It was unclear whether he would show up on Capitol Hill in person or stay in the Bahamas where he's been hold up for much of the time since his company filed for bankruptcy last month. holding interviews with reporters. The ex-CEO of FTX has been on a media blitz the last month, talking about the implosion of his crypto empire, but this will be the first time the public has

Starting point is 00:04:46 the chance to hear from SBF under oath. Bankman Freed wrote in a Twitter thread that he still did not have access to much of his data, professional or personal, so there was a, quote, limit to what he would be able to say. Quote, I won't be as helpful as I'd like, but as the committee still thinks it would be useful, I am willing to testify on the 13th. He continued in the post, end quote. Lots of year-end lists coming out right now, of course, like there are every year, best movies, best albums. But what about emoji of the year?

Starting point is 00:05:22 Well, Rolling Stone makes the excellent point that there's really only one candidate. The salute emoji, quote, in the end, no emoji was better suited for the ups and downs of 2022 than the saluting face. Everyone from an ex-pro call-of-duty gamer to a Berkeley City council member to musician Zafani Zhang found them. themselves obsessed with the stalwart little expression. More than one fan has claimed that the emoji changed their lives, helping them persevere through trial and tribulation. Recently, the saluting face became a symbol of solidarity among Twitter employees, fired by incoming CEO and

Starting point is 00:05:55 owner Elon Musk, as well as those who quit in protest of his frenetic management style. It became such a common shorthand for leaving the company that it appeared hundreds of times in internal Slack channels, as remaining staff members opted for a three-month severance rather than continue working nonstop to achieve musk's ever-shifting objectives. In that moment, an emoji often deployed with a dose of irony turned curiously sincere, as laid off designer Audrey Davis observed, she never thought the saluting face would make her sob. It had the error of going down with the ship of defying a capricious billionaire, though most of all it said, it has been an honor to serve with you, the salute as farewell, and a final bit of respect, end quote. Time for the weekend. Long

Starting point is 00:06:45 read suggestions. First up, okay, all of this new AI stuff, especially chat GPT, it seems pretty cool, right? But it also, as I've said a couple times, has the potential if you squint at it a certain way, as coming off as maybe a party trick, a gimmick. Well, this piece from the Wall Street Journal points out that natural language processing algorithms could slash the time required to bring new pharmaceutical drugs to market. That would be useful, quote. Proteins, are made up of dozens to thousands of small chemical subunits known as amino acids, and scientists use special notation to document the sequences. With each amino acid corresponding to a single letter of the alphabet, proteins are represented as long sequence-like combinations.

Starting point is 00:07:29 Natural language algorithms, which quickly analyze language and predict the next step in a conversation, can also be applied to this biological data to create protein language models. The models encode what might be called the grammar of proteins, the rules that govern which amino acid combinations yield specific therapeutic properties to predict the sequences of letters that could become the basis of new drug molecules. As a result, the time required for the early stages of drug discovery could shrink from years to months. Nature has provided us with tons of examples of proteins that have been designed exquisitely with a variety of functions, says Ali Madani, founder of ProFluent Bio, a Berkeley-California-based startup focused on language-based

Starting point is 00:08:09 protein design, we're learning the blueprint from nature, end quote. Then chalk this up to another tech niche that is seeing bad times all the sudden in 2022. E-sports, quoting Bloomberg. Sports business billionaires and gaming executives had hopes that e-sports could one day scale into an organization like the National Basketball Association. But after a boom five years ago, several prominent e-sports teams and organizations, particularly in the U.S., are contracting the result of a broad economic downturn, a venture capital industry that's no longer willing to accept growth without profits, and a crypto meltdown that has undercut a significant source of backing. Investors who were once eager to get in early on what was expected to be a booming industry

Starting point is 00:08:54 are now scrutinizing the business fundamentals and not much liking what they see. In 2018, a record $4.5 billion was invested in the industry, including from private equity firms jumping in for the first time, according to a report by Deloitte. that bounty has faded, and venture capital investment in e-sports is the lowest it's been since 2016, excluding 2020 when pandemic restrictions threw into question the viability of live e-sports tournaments, according to data provided by pitchbook, end quote. Next, you all know I'm an e-ink tablet fan because of the remarkable, but what can you do with e-ink tablets besides just write and sketch?

Starting point is 00:09:32 What would be possible if hand-drawn sketches were programmable like spreadsheets? That's the question posed by this piece from ink and switch, quote. Spreadsheets support gradual enrichment by allowing you to quickly put text and numbers in arbitrary boxes, as if using a pen and graph paper, do some basic math, as if using a calculator, move things into neat rows and columns when you find yourself making comparisons, and add more formula-driven cells and labels if and when necessary as your model evolves, incrementally building dynamic complexity over time. You might eventually polish the formatting, clearly label input cells,

Starting point is 00:10:07 and turn the model into a reusable piece of situated software. Each bit of effort to refine the model is a small investment made in a moment when the payoff is immediate. We want a digital pen and paper that maintains as many of the above attributes as possible, but with all of the benefits of a dynamic digital medium. The most important being programmability, describing new behaviors for a sketchbook to take on, automating and processing, and simulating, end quote. Read the whole thing for some amazing possible use cases,

Starting point is 00:10:36 they mention like, for example, a furniture designer could sketch a pattern for a table leg. After they decide they love a pattern that repeats a vine figure and a spiral down the leg, they automate the hand-drawn spiral pattern so they can try out different vine shapes instantly as they sketch. This helps them explore the design space quickly and stumble on entirely new designs. Or let's say an engineer on a circuit design team is trying to illustrate to a colleague how their signal processing might be flawed. They roughly sketch what an incoming signal might look like, and then, in a model of what the circuit will do. The engineers take turns sketching on the page, trying out different signals and models, coming to a shared understanding of the problem.

Starting point is 00:11:14 This would be frigging wild if they could pull stuff like this off. Then, did you know that the original story that led to the collapse of FTX was published by CoinDesk? Did you know that CoinDesk is owned by DCG, which is run by Barry Silbert? If so, you might also remember that DCG is one of the creditors trying to get their money back from FTCS and Sam Bankman-Fried, which might be lost. Imagine that. Your own journalism arm publishes a story and blows up the business that runs the journalism arm. Well, now CoinDesk is up for sale to try to raise some much-needed funds for its parent company, quoting the verge. Everyone I spoke to at CoinDesk, whether on or off the record, wanted to emphasize that

Starting point is 00:11:57 CoinDesk has editorial independence. No shit. Under what other circumstances would journalists blow up their imperiled sister company? I found the defense. I'm a fan of CoinDesk. There are other crypto outlets that employ journalists I respect, but I actually visit the Coin Desk front page just to see what's up, which is why I'm anxious about the specter of a buyout since there's no guarantee new owners will continue to let it thrive as DCG is done. Like, what if the monsters at Alden Global Capital buy it, end quote? Then in recent weeks, you might have seen the image doing the rounds on social media. It's a picture of 54 white crossover essay.

Starting point is 00:12:35 SUVs that all kind of look identical despite the fact that they were made and designed by dozens of different car manufacturers. Is design dead? That's what this piece by driving conformity asks. Quote, we think we want a huge variety of options, but variety cripples our ability to make easy decisions. Car companies give the illusion of variety while keeping the actual categories very basic. This is why you only get five color options instead of choosing from a pantone book. Deciding between red and white is easy compared to deciding between fire red or cherry red, sometimes even the broad categories aren't enough to completely eliminate the indecision of the fickle customer. To satisfy consumers who couldn't decide between a truck, car, van, or SUV, a new category was created.

Starting point is 00:13:20 It is called the crossover. The crossover is the ultimate one-size-fits-all product. It is a truck without being a truck. It is a car without being a car. It is an SUV without being an SUV. It is a minivan without being a minivan. It is fast, yet fuel a efficient, yet powerful, yet roomy, yet safe. It is as if the car companies took the wishlist of every consumer type and Frankensteined it altogether in a single vehicle. Industry analysts Horace Deju describes the categorization of the car landscape like this. Quote, they have the same bunch of cars, the same sizes, same cookie cutter as everyone else, and they are all built using the same process. It's the same process. It's the same cost structure. It's the same quality. So you can't

Starting point is 00:14:00 differentiate anymore, end quote. If you squint at a crossover, you can impose whatever vehicle you want onto its bland exterior. It has the rounded lines of a car. It has the rugged stance of an SUV. It has the extended rear end of a station wagon. It has the space maximizing bubble shape of a minivan. It doesn't have a flat bed, but add a hitch and a towing package and your internal truck voice will be satisfied. The only major identifying mark on the car is the logo on the front and rear of the crossover. Brands are shortcuts that map to categories in our mind. We are so brainwashed by brand messages that we no longer see the inherent meaning in the products we buy. We don't look for the car with the best-built engine. We look for the logo that has

Starting point is 00:14:39 been linked in the collective cultural consciousness with build quality. Imagine if all the crossovers pictured looked dramatically different. All of the sudden, the purchasing decision gets hard. If I consider myself a Toyota person, but I like the body style of the Kia, I won't be able to decide. If I am looking for luxury, but the Ford looks more luxurious, I again get stuck. By homogenizing the style across all brands, every brand sells more because the decision is easier, end quote. And finally, one just for me, I love visiting places merely to run an experiment to try to discover if I could live there. That's why we recently did our weekend in Providence, Rhode Island, because if we someday leave New York City, but I want to stay in the Northeast,

Starting point is 00:15:24 what are our options? It's also why I want to go to the Faroe Islands. If I just wanted a cabin in the middle of nowhere, literally, could I hack it out in the middle of the North Sea? And it's also why I want to go to New Zealand. I mean, we all want to go to New Zealand, right? But I really have a suspicion I would want to end up living there. Thus, the final link in the show notes today is to the latest New York Times piece, that series that they do where they tell you what it's like to spend 36 hours in a given place in the world. This time, it's Wellington, New Zealand. I very, very, very much want to go to there. All right, so our year-end bonus episode, chewing over the biggest stories of the year in the tech industry, as well as

Starting point is 00:16:15 some predictions for next year. That will drop tomorrow. Come for the analysis. Stay for some personal news from Chris. Talk to you on Monday.

Tech Brew Ride Home - Fri. 10/09 – FTC Sues To Block The Microsoft/Activision Deal

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