Tech Brew Ride Home - Mon. 07/20 – eBay to Sell Its Classified Ads Business?

Episode Date: July 20, 2020

eBay seems to be selling every last thing it can before all it's left with is its marketplace and its pride. Disney has quietly cut its Facebook advertising too. When might we actually seen Windows 10x? And what is GPT-3 and why was everyone freaking out about it over the weekend? Sponsors: Tovala.com/ride Metalab.co Links: EBay Nears Deal to Sell Classified-Ad Unit to Adevinta (WSJ) Reliance Jio: World’s First ‘Super Operator’? (Counterpoint) Disney Slashed Ad Spending on Facebook Amid Growing Boycott (WSJ) The easiest way to start meditating is now in... Snapchat? (Mashable) Microsoft plans for single-screen Windows 10X rollout in spring 2021; dual-screen in spring 2022 (ZDNet) Quick thoughts on GPT3 (Operators & Delian's Ramblings) Giving GPT-3 a Turing Test (Kevin Lacker's Blog) Video Example 1 Video Example 2 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 right home for Monday, July 20th, 2020. I'm Brian McCullough today. eBay seems to be selling every last thing it can before all it's left with is its marketplace and its pride, I guess. Disney has quietly cut its Facebook advertising also. When might we actually see Windows 10x?

And what is GPT3 and why was everyone freaking out about it over the weekend? Here's what you miss today in the world of tech. sources are telling the Wall Street Journal that eBay is in advanced talks to sell its classified ads business to Norway's at Aventa for around $8 billion. Quote, eBay, once a high-flying internet conglomerate with brands like PayPal and Stubhub, has been unwinding that structure under pressure from activists' investors who argued it shrouded eBay's value. The classified unit is one of the last remaining businesses outside the core marketplace, after the company struck a deal to sell its stub hub ticketing division last year. eBay's classified unit primarily operates internationally across Canada, parts of Europe, Africa, Australia, and Mexico. Its platforms allow users to post goods and services in their local communities,

similar to Craigslist in the U.S. Last year, the division produced $1.1 billion in revenue compared with the $7.6 billion its marketplace business generated. eBay has been seeking to sell the unit since around February when the Wall Street Journal reported that it was up for sale. At Aventa oversees digital marketplaces in 16 countries with a significant presence in parts of Europe, South America, and Mexico. By acquiring the eBay business, Ataventa would significantly expand its presence in Germany, one of Europe's biggest economies where its current operation doesn't hold a dominant position, according to the company's website,

end quote. Somewhat ironic that the newspaper industry is going through its final death throes, while at the same time, one of the major reasons for the death of newspapers is being sold for scrap parts because most people don't see it as a growth business. But also, of course, there's the whole matter of Elliott Management and Starboard Value, being activist investors, trying to get eBay to divest itself of everything but the marketplace. One wonders what kind of a business eBay will be if it's just, again, a marketplace. In Q1 of this year, eBay's main marketplace slash auction business still generated $2.1 billion in revenue, and that was in the teeth of the beginning of the pandemic, although the classified business, as noted, only did about a tenth of that.

I'd still be happy with the marketplace business for sure. Has to have great margins, right? Has to throw off a ton of cash regularly, although maybe I'm wrong, but also the larger problem for eBay is that everyone from Facebook to Chinese super apps want a part of that business all the sudden, right? Speaking of super apps, over the weekend, I found a piece that fills in some of the gaps in my knowledge around Reliance Geo. And indeed, according to this piece, it all boils down to just what we expected. Counterpoint Research has a chart out showing how Reliance Geo is laying a strong foundation to become what it calls a super operator, applying a WeChat-like super app approach to its mobile telecom network in India. If you look at the helpful chart attached to the piece that

I've linked to in the show notes, you'll see. It is actually maybe useful for Reliance to bring all of these partners to the table because they all seem to be contributing an important piece of the overall puzzle. This is from Counterpoint Research. We believe Reliance Geo or Geo Platforms is transforming into a super operator which is no longer a dumb pipe. With a platform approach, it is laying a strong foundation to play a key role across the user's digital lives and businesses' digital transformation journeys. None of the operators we can think of globally promises to build, offer and control what Geo is capable of. Geo's strategic partnerships with key companies such as Facebook, Google, and Microsoft,

the three biggest tech giants will help it drive commerce, communication, and cloud areas respectively, where it has been weak in terms of capabilities, reach and adoption. Further, acquisitions such as haptic, AI voice assistance, imbibe, education content platforms, reverie, multiple language integration, saven, music streaming, Tesseract, AI, VR, VR, and Radysys, which is the network stack, may bridge many capability gaps to foster in the upcoming 5G era. With 5G around the corner, Geo can lay out a fully controlled greenfield network to build the software stack via Radicis in fixed as well as wireless networks. It remains to be seen if there are any big moves on the radio access network hardware side

or might it depend on the long-term partner Samsung. With Google, Geo aims to democratize 5G hardware with plans to offer the most affordable 5G Android smartphone in the market with the OS specifically optimized for a low-cost 5GGO smartphone. We estimate this to soft launch in Q4, 2021, and proliferate through 2022 and 2023 with a target price point of a sub-100 range, end quote. So it does sound like maybe I had things backwards. Maybe this all started because Reliance Geo just set out its shingle and said to the world's pools of money, come plug yourself into what we're going to.

we're building first come first serve. The way the chart looks, it sort of seems like they all have various pieces that geo needed and maybe couldn't build itself. Though Benedict Evans does throw some cold water on this, tweeting, quote, every five years or so a telco thinks it can move up the stack and compete with the internet. This is a little like a municipal water company trying to get into the soft drinks business. I would write a long thread about why companies with tens of thousands of employees generally fail to compete with five-person startups at innovative consumer services. But if you needed to read that now, it's far too late, end quote. Quick bit of news from over the weekend, one of Facebook's biggest advertisers had all along

been conspicuously absent during the whole ad boycott brouhaha, at least that we knew of. But sources are telling the Wall Street Journal over the weekend that Disney has indeed dramatically cut ad spending on Facebook and Instagram. That is important because estimates are that Disney was Facebook's top U.S. advertiser in the first half of 2020. Quote, unlike many other companies, Disney didn't make a public announcement that it was cutting back on Facebook, but instead shifted advertising plans quietly. The entertainment giant, which is concerned about Facebook's enforcement of its policies surrounding objectionable content, has paused advertising of its streaming video service Disney Plus, the people familiar with the situation said. Disney has promoted

the service heavily this year, and it makes up a substantial portion of the company's spending on marketing. In the first half of this year, Disney spent an estimated $210 million on Facebook ads for Disney Plus in the U.S., according to Pathmatics. Disney was the biggest ad spender during that period. Last year, it was the number two Facebook advertiser in the U.S. behind Home Depot. Disney also paused spending on Facebook-owned Instagram for its sister streaming service, Hulu, a person familiar with the matter said. Hulu spent $16 million. on Instagram from April 15th to June 30th, Pathmatic said. Other divisions of Disney are also re-examining their advertising on Facebook.

Ads for ABC and Disney-owned cable networks such as Freeform have all but vanished from the site. While there are fewer shows to market during the summer, a person familiar with the matter said, it is unlikely that ads will return when new episodes need to be promoted unless the social platform polices itself better, end quote. Remember Snap's strategic decision to federate itself? to try to become a platform for others to build out, not just a platform for others to build on. Well, the first fruit of that strategic move is here, as Snap has partnered with Meditation App Headspace to debut Headspace minis in-app meditation tools designed to be used with friends,

quoting Mashable. Snapchat users don't have to have the Headspace app or even be headspace subscribers to access the meditations because the headspace mini lives within Snapchat itself. Users can access the mini in chat by clicking on the rocket icon at the bottom of the screen, which initiates a headspace session with Snapchat that the person or people they're chatting with can also click to join. Once a user clicks into a session, there are six three to four minute meditations to choose from. Just breathe, get out of a funk, kick the panic, be nice to you, pressure to succeed and me time. Andy Puddacombe, the co-founder of Headspace, narrates the meditations and his voice, along with its pleasant British accent, is as soothing as ever. The meditations focus on

mindfulness basics. Not passing judgment when thoughts enter your mind. Returning attention to your breath, noticing how you feel. Users in a session each choose their own meditations, and they're not synced over video or audio or anything like that. But if friends are doing a session together, their bitmoji will appear in the bottom left corner of the screen. You can also chat within the mini, but that pauses the meditation. The true purpose of the Bitmoji presence seems to be a digital signal that you're not alone, end quote. Sources are telling ZDNet that Microsoft does indeed plan to release Windows 10X for some single-screen devices in less than a year, debuting around the spring of 2021.

But the much anticipated and hyped by Microsoft dual-screen devices won't get Windows 10X until the spring of 2022. quoting, of course, Mary Joe Foley. Quote, Windows 10X, codenamed Light or Santorini, is not a new operating system. It's a Windows 10 variant in a more modular form and with a new simpler interface. Originally, Microsoft planned to ship 10X first on new dual-screen devices such as the postponed Surface Neo. Now I'm hearing Microsoft's latest plans call for 10X to debut on single-screen devices designed primarily for businesses, especially first-line workers and education in the spring of 2021. And in the spring of 2022, Microsoft is aiming to roll out 10X for additional single-screen

and dual-screen devices, my contacts say. The first release of 10X will not include support for running Win32 apps in containers, as originally planned, as Windows Central reported, and I am hearing as well. Instead, it will be able to run Universal Windows Platform, UWP, and Web Apps only. Windows Central's Zach Bowden believes that Microsoft might be counting on Microsoft's new cloud PC virtualization service, which I reported on this week, to provide those who need Win 32 apps with access to them. My bet is Win32 container support won't be there, not just because of power slash resource overhead, but because Microsoft has had problems with Win 32 app performance

on 10x. I'm hearing Microsoft hasn't given up on running Win 32 apps in containers on 10X, but likely not until 2022 at the earliest, end quote. Bit of tweet translation here from the aforementioned Zach Bowden, end quote. Microsoft is planning to ship Windows 10X as a web-first OS on low-cost PCs without local support for Legacy Win 32 apps. I'm told Microsoft will push app streaming as a solution for those who need legacy apps on Windows 10X instead, end quote. And Russell Holly tweeted, quote, I'm really going to enjoy watching Microsoft's hail this as a Chrome OSW. killer, after years of unsuccessfully bashing the platform for not being capable enough while

it gobbles up market share. Smartphones all over again, end quote. Finally today, let me hip you to something that got a lot of attention over the weekend. It's not really a news story per se, but let's just say a lot of folk in Silicon Valley have woken up and decided that GPT3 might Harold the beginnings, the stirrings, perhaps, of a next big thing in tech. Let me give you some background. OpenAI is an AI research foundation, started by Elon Musk, Sam Altman, as well as a who's who of big names and things like machine learning. GPT3 is OpenAI's text-generating AI that debuted about a month ago and is a language model trained

with 175 billion parameters. It's a successor to the previous GPT2, which had only one and a half billion parameters. In short, remember how we've discussed on the show before, how AI can't really read, can't really speak, and that's sort of holding it back? Yeah, well, this is from an essay by Delian Asperuhoff that's been getting passed around all weekend. Delian has been been playing with GPT3, and let's just say he was impressed. Quote, GPT3 is essentially a context-based generative AI. What this means is that when the AI is given some sort of context, it then tries to fill in the rest. If you give it the first half of a script, for example, it will continue the script. Give it the first half of an essay. It will generate the rest of the essay. I fed it half of an

essay on how to run effective board meetings. And it effing wrote up a three-step process on how to recruit board members that I should honestly now put into my damn original essay. Both times the AI was able to generate cogent, although not always correct, additional paragraphs, and in both examples, was able to follow the prior formatting, i.e. section headers and steps. What's incredible about the tool is that you can feed it almost any context, a script about a gay couple in Italy, an interview between two tech luminaries, or even a political column about an election, and it is able to put together decently coherent arguments. Now, before you get too excited, this isn't some sort of general AI,

and the machine doesn't really have a way of understanding if what it is outputting is true or not. The simplest way to explain how it works is that it analyzes a massive sample of text on the internet and learns to predict what words come next in a sentence or given prior context. Based on the context you give it, it responds to you with what it believes is the statistically most likely thing based on learning from all this text data. This is a strategy that OpenAI and other researchers have been pursuing for quite some time by starting off with a simple problem like trying to predict the next word in a sentence. We have now steadily built up to where they are today where a model like GPT3 can complete several paragraphs or more. Though an incredible result,

even GPT3 at some point may lose direction and wander aimlessly. Despite its massive size, over 175 billion parameters, as mentioned, it still may struggle with keeping a long-term destination in mind or holding logical, consistent context over many paragraphs. This means, in my opinion, although there's debate on this, that while this tool is very impressive and GPT4 will likely show further improvements, there are probably diminishing marginal returns to this approach. They can keep getting better at running really complicated statistics

on all the text people have ever written, but the AI is still not capable of reasoning, end quote. Okay, so maybe the AI is not reading and writing just yet, but it has gotten really good at tricking us into believing it's reading and writing. Actually, there's another link towards the bottom of the show notes where Kevin Lacker gave GPT3 a Turing test. It didn't pass exactly, though, if you had run this test maybe 10 years ago, it would have fooled a lot of people. and the overall results were interesting. I'm not going to read you the whole thing, but I think I can sum up this story by saying this type of AI has made a leap that is exciting a lot of people, because at the very least,

this sort of thing should lead to way, way, like generationally, way better voice assistance. And aside from that, there are some interesting possibilities for things like coding and design. Also in the show notes, there are two tweets with live video from Sharif Shamim, where first, He wrote a sentence describing what Google's homepage should look like, and GPT3 generated the code that generated an actual nearly identical Google homepage. Then he built a functioning React app by, again, just describing what he wanted GPT3 to do, and it generated it, all of the code. There's been a bunch of debate and pushback on all of this.

Sam Altman himself tweeted over the weekend, the GPT3 hype is way too much. It's impressive, thanks for the nice compliments, but it still has serious weaknesses and sometimes makes very silly mistakes. AI is going to change the world, but GPT3 is just a very early glimpse. We have a lot to still figure out, end quote. That is Paul Graham tweeted also this weekend. Hackers are fascinated by GPT3, and to everyone else it seems like a toy.

Pattern seem familiar to anyone, end quote. It is hot here in New York City. Very hot. That is the only observation I have for you after this weekend. Hot. Talk to you tomorrow.