Tech Brew Ride Home - Mon. 10/31 – Would You Pay $20/Month For Twitter Blue?

Episode Date: October 31, 2022

Just, massive wholesale changes at Twitter, including possibly making folks pay up for features. Pitty the poor tech billionaires who have collectively lost half a trillion in wealth this year. When the M2 MacBook Pros should be showing up. And what colors might you be blocked from using on Adobe products? Sponsors: RocketMoney.com/ride Links: Elon Musk wastes no time changing Twitter (The Verge) Twitter is planning to start charging $20 per month for verification (The Verge) The 20 Richest Tech Billionaires Have Lost Nearly Half a Trillion Dollars This Year (WSJ) Apple Gears Up to Launch Its Next Crop of Macs Early Next Year (Bloomberg) India's Central Bank to Start Wholesale CBDC Pilot Nov. 1 (CoinDesk) You’re Going To Have To Pay To Use Some Fancy Colors In Photoshop Now (Kotaku) 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, October 31st, 2022. I'm Brian McCullough today. Just massive wholesale changes happening at Twitter, including possibly making folks pay up for features. Pity the poor tech billionaires who have collectively lost half a trillion dollars in wealth this year, when the M2 MacBook Pros should be showing up, and what colors might you be blocked from using on Adobe products? Here's what you miss today in the world of tech. Did I really once say that once the Twitter deal closed. There would be sort of an end of new news around the whole thing. So many threads to try to weave into a coherent tapestry for you. First of all, what we've been hearing

is that a so-called war room was convened to work over the weekend to enact big changes. Now that Elon is in charge, Sri Ram Krishnae of A16C confirmed he was one of those in the war room, prompting a lot of speculation that he'll be named Twitter CEO at some point. Also reported to be in the room with Elon himself are investor David Sacks, investor Jason Callicanis. So should we expect a special all-in podcast episode soon? Also, Elon's legal and finance team and a whole bunch of engineers from Tesla slash boring company. Why? Maybe to overhaul the Twitter product. Weirdly, though, the first change to the product seems to be this.

Elon Musk directed Twitter executives to quietly change the homepage for logged out users to the Twitter explore page instead of a sign-up form. Quoting the verge. Before, visiting Twitter's homepage while logged out showed only a sign-up form encouraging the creation of an account to view tweets. Musk's directive, which was implemented late Friday, required VP involvement to override a code freeze put in place to prevent rogue staffers from making changes during the takeover process. though Musk didn't widely articulate a reason for the change to the employees who observed it,

the message was clear. No more sacred cows. Inside the old Twitter, such a decision would have been thought over between teams for weeks, but this was the new Twitter, as a former executive told me, quote, that's definitely one way to make it clear you're in charge now, end quote. Also, word that Twitter is strongly considering taking away its verified user's badges if they don't subscribe to Twitter Blue and that, Twitter Blue, could soon cost $20 a month, which might actually be tied into getting verified, quoting Alex Heath. The directive is to change Twitter Blue, the company's optional $4.99 a month subscription that unlocks additional features into a more expansive subscription that also verifies users, according to people

familiar with the matter, and internal correspondence seen by the Verge. Twitter is currently planning to charge 1999 for the new Twitter Blue subscription. Under the current plan, verified users would have 90 days to subscribe or lose their blue checkmark. Employees working on the project were told on Sunday that they need to meet a deadline of November 7th to launch the feature or they will be fired, end quote. First, to note, as Emily, GPU prices said on Twitter, quote, there are about 300,000 verified Twitter accounts. If every single account opted to pay this fee, this would bring in about 18 million in revenue yearly. That's enough to pay off the $44 billion purchase price in slightly less than 2,500 years, end quote. Lots of

about how $20 a month is way too high to get too many people to bite on this unless the advantage is truly are expansive. But as to those Twitter employees, sources are reporting that Elon Musk plans to lay off, well, the numbers are all over the place. Some say 75%, some say 50%, some say at least 25% of Twitter's workforce in the coming days, focusing on roles in the sales, product engineering, legal, and trust and safety teams. Also, there has been reporting that when Elon fired those four Twitter executives last week, including CEO Paragagrawal. He did so for cause in an apparent attempt to avoid those severance and unvested stock payouts that we spoke about last week. So expect more litigation soon, I guess. There's also been rumors that firings

to regular staff might happen before other folks can claim originally stock-based payouts. Here's some reporting from friend of the show Gergelli Oros on Twitter, quote, What I'm hearing, lots of Twitter software engineers and managers working through the whole weekend to get the verified feature done by Wednesday else they are told their whole team can be fired. Dozens of tickets closed on iOS, Android, etc. Takes time to ship completed work to Apple Store. Software engineers I talk to assume this arbitrary deadline serves several purposes. One, a test. It's expected many will be let go who are seen as less productive or unwilling to work long hours. Two, an early success story, enabling immediate incremental revenue. Three, trigger resignations.

There are people I talked with who did not go along with working over the weekend, given they have families on a life outside of work. They're, of course, stressed on what will happen next. The Ship-in-or-get-fired brings these stakes to a new level. And for what exactly? Then there are people who did go along with this and still got fired. I talked with an engineering manager who was at Twitter for five-plus years and got laid off on Sunday for cause.

They were too exhausted from working over the weekend to talk longer. They first need to sleep, end quote. Earlier in the weekend came news that General Motors has suspended its paid advertising on Twitter as the car company evaluates the, quote, direction of the platform under their new ownership, end quote. So, rumors of a staff mass casualty event. One wonders how efficiently the operations at Twitter will keep humming with so many people sent out the door or at least demoralized, and advertisers already skittish around the whole situation.

A reminder that Twitter faces around a billion dollars per year in interest expenses after Elon Musk's deal added $13 billion in debt, up from around $50 million in debt that Twitter had in 2021 when operations generated around $633 million in cash flow. So the clock is ticking. There isn't a ton of room for error here before Musk's bath taken on this whole deal could potentially get a lot warmer. Finally, this is tongue and cheek, obviously, but the joke here would be if you really wanted to play an angle on this whole deal finally coming to conclusion,

you should have done it by buying Doge. Doge coin apparently surged by nearly 75% on October 29th after Elon Musk took control of Twitter, its biggest daily gain since April 2021, and is up 150% since October 25. This is, I suppose, not unrelated to that. The Wall Street Journal has tallied up what has happened to the top 20 tech billionaires globally this year, and it ain't pretty. Quote, the world's richest tech moguls, including Mark Zuckerberg, Bill Gates, and Larry Ellison have seen more than $480 billion in paper wealth disappear this year through Thursday. According to the Bloomberg Billionaires Index, a daily ranking of the richest people in the world. Mr. Zuckerberg's net worth fell by $11.2 billion alone on Thursday, according to the ranking. So far this year, the wealth of META's chief executive has fallen by more than $87 billion.

That leaves him with a current net worth of $37.7 billion, good for the 28th richest person in the world, according to the index. By comparison, he was among the top 10 earlier this year. Elon Musk, the world's richest person and Jeff Bezos, the founder of Amazon, have each seen more than $58 billion in wealth wiped away this year. Both entrepreneurs have jockeyed in the past for the bragging rights of being the world's richest person, before Mr. Musk pulled away with a sizable lead. Google Parent Alphabet co-founders, Larry Page and Sergey Brin, who are among the 10 richest people in the world, have also seen their net worth dented. They have each lost more than $40 billion in paper wealth this year,

with both taking hits this week after Alphabet reported its first ever drop in YouTube year-over-year ad sales. Most of the richest tech entrepreneurs are a who's-who of American tech tycoons, but a few of them are from outside the U.S. Jack Ma, for instance, built his e-commerce giant Alibaba from scratch into one of China's largest business empires. He has lost $9.3 billion in wealth this year, according to the index, and currently has a net worth of $29.1 billion. Of the 20 richest tech billionaires, only two have added money to their bottom lines since January 1st, according to the index. The wealth of Zhang Ye Ming, the founder of TikTok's owner Bite Dance, has risen by $10.4 billion, and he's now currently worth $54.9 billion. Robert Perra, the founder of Wireless Equipment

maker, ubiquity, and owner of the NBA's Memphis Grizzlies, has seen his wealth go up $1.3 billion, giving him a net worth of $14.7 billion, end quote. Another week and another update from Mark German's weekly Apple Rumors newsletter. He says this week that Apple plans to launch M2-based versions of the 14-and-16-inch MacBook pros in early March next year. The M-2 Macs will have 12 CPU cores and 38 GPU cores, according to Mark. quote, I'm told that Apple is aiming to introduce the upgraded models, including M2-based versions of the 14- and 16-inch MacBook Pros in the first quarter of calendar 2023 and has tied the launches to the upcoming macOS Ventura 13.3 and iOS 16.3 updates. Those software updates are expected to debut between early February and beginning of March. Apple has rarely launched new products in January or February during recent years, so I expect the new Macs to be announced by the first half of March. That aligns with the planned ship dates for the corresponding software, but also make sense in light of Apple's recent history of

launching new Macs during that month, including the Macs studio this year. While Apple had aimed to release the new MacBook pros as early as this fall, the company's internal plans, confirmed by public comments this past week, have shut the door on that. During the company's quarterly earnings call, Thursday, Chief Executive Officer Tim Cook called the product line set for this holiday season. Lucomestri, Apple's chief financial officer gave us even stronger confirmation. He said that Apple's holiday quarter, which ends on December 31st, would see revenue growth decelerate compared with the previous period, in part because there will be no major MacBook

Pro launch like there was in the prior year. Apple introduced the redesigned 14-and-16-inch MacBook pros with the M1 Pro and M1 Max chips last October, contributing to $10.9 billion in Mac revenue in the holiday quarter. This time around, expect the Mac revenue number to come in far below that, end quote. We've got another one. The Reserve Bank of India says it plans to begin testing its central bank digital currency on November 1st, with nine banks participating in a retail version of the currency by the end of November, quoting Coin Desk. The RBI said a pilot of the retail version is planned for launch within a month in select

locations in closed user groups comprising customers and merchants. The bank published a 50-page concept note for the introduction of a central bank digital currency earlier this month. India will have a prominent role in framing global crypto regulation when it takes over over the G20 presidency for one year, starting from December 1st, 2022, till November 30th, 2023. And the nation's finance minister, Nirmala Sitharaman, has said crypto will be part of the agenda. Since early 2021, it's been known that 80% of central banks around the world are exploring CBDCs. Recently, Australia's central bank started a CBDC research project and announced plans

to complete the pilot by mid-20203. And the central banks of Israel, Norway, and Sweden have teamed up to explore retail CBDCs, end quote. Again, so much action in the whole design slash stock photo slash productivity space recently. Adobe apps will no longer support Pantone-owned colors for free due to a licensing change. Users of Adobe products would need an Adobe plugin costing $15 a month to continue accessing Pantone colors, quoting Kataku. Pantone has been around since the 1950s, the New Jersey company originally refined printing inks, then later invented the Pantone color matching system, used worldwide by designers to ensure a creation's color will be exactly as desired no matter where or how it's manufactured. So, of course, in becoming the industry standard for color matching, the company naturally asserts ownership of all 2,161 hues,

defending its intellectual property and preventing its unlicensed use. This extends as far as preventing others from creating pantone compatible color systems. or to put it another way, they claimed to own colors. Last year's announcement that Adobe would be removing the Pantone color books from its software brought consternation in the design world. One industry standard being removed from another was obviously going to create issues, but at the time, Adobe said it would be, quote, working on an alternative solution while rumors spread that the companies had had a falling out.

Since then, the official reasons given haven't made a great deal of sense. According to Pantone, the two companies started working together in the 1990s, but, quote, since 2010, the Pantone Color Libraries within Adobe's apps have not been updated. This apparently means they're, quote, significantly out of date and missing hundreds of new Pantone colors. This means that Pantone and Adobe have together decided to remove the outdated libraries and jointly focus on an improved in-app experience that better serves our users, end quote. The removal of Pantone's colors from Adobe's software was meant to happen on March 31st this year, but that date came and went. It was then due for August 16 and then August 31st. However, this month, people are noticing the effects reporting issues with creations using Pantone's spot colors.

And the solution? It's an Adobe plugin to, quote, minimize workflow disruptions and to provide the updated libraries to the Adobe Creative Cloud users, end quote, which of course costs $15 a month. It's Netflix, but for coloring in. However, Pantone still states in its out-of-date FAQ that, quote, this update will have minimal impact on a designer's workflow. existing Creative Cloud files and documents containing Pantone color references will keep those color identities and information, end quote. Yet today, people are reporting that their Photoshop is informing them, quote, this file has Pantone colors that have been removed and replaced with black due to changes in Pantone's licensing with Adobe, end quote. Others have reported that even attaching a Pantone license within Photoshop isn't fixing the issue, colors still replaced by black and workarounds sound like a pain. A tip suggested by Printweek is to back up your Pantone libraries, then re-importing them when your Adobe software updates to remove them, or if it's too late, finding a friend who already did.

There's a good chance this will work, given Pantone's colors are stored as dot ACB files, just as the rest of Photoshop's colors, end quote. Hey, I could use a hand with something. I've got a portfolio company that I've not been able to bring on the show yet, but they've just closed their first big round, and they've got money to spend, so they've won. to up their cybersecurity game. If their main focus is finding a kick-ass security service that is strong at continuous penetration testing, who would you recommend I send to them? Who's your favorite vendor in the space that a young seed company could fit in well with? Send your ideas to me on Twitter at Brian MCC or email me at Brian at ridehomefund.com. Thanks in advance. Talk to you tomorrow.