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When I covered markets in the late 1990s and early 2000s I hated days like Monday. Stocks plummeted more or less in lock step, and I had to call “experts” to explain why. They made up reasons, and I printed them. It was all highly unsatisfying.
So is trying to say anything intelligent about why everything was down Monday, including Apple (2.5%) Amazon (3%), Alibaba (4%), and Alphabet and Facebook (5% a piece). A day when everything craters couldn’t be less interesting to someone who tells stories about individual companies. Last week, by comparison, when Alphabet and Apple dropped as Amazon jumped, all in response to their respective earnings reports, was at least informative about their relative performance.
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Massive stock market drops are absolutely real, and over time they can affect everything from corporate strategies to employee retention. It’s best to focus, though, on the “over time” part of the equation. One day means next to nothing.
A mentor of mine—her name is Xana Antunes—once taught me that sometimes the best stuff is in the 17th paragraph or so of a news article. I found two such impressive examples in Monday’s Wall Street Journal. Columnist Christopher Mims reported that steadily growing services revenues were 9.6% of Apple’s total in its most recent quarter but 16% in its fourth fiscal quarter. The point is that services are smoothing out an otherwise lumpy business. Smart insight. Similarly, a detailed look at Apple Music and Spotify by Anne Steele teases out the incredibly complicated ways the companies record their user data. Her conclusion: Apple Music may best Spotify in the U.S. sooner than most thought.
Briefly … In my sheltered world, it’s an odd feeling when someone you know even a little is in prison. That’s how I’ve felt this last year thinking about the urbane, charming, powerful Jay Y. Lee behind bars in his native South Korea. I profiled him in in Fortune in 2015. Monday he was freed. … I couldn’t catch all the Super Bowl ads Sunday night, and Monday I missed the chance to praise another: Amazon’s spoof on Alexa losing her voice … I mis-linked yesterday to an Economist article about advocates of a consumer’s union for data. Here’s the correct link.
Triple play. Elon Musk’s Space Exploration Technologies plans to launch its new, more powerful Falcon Heavy rocket on Tuesday afternoon. “I would consider it a win if it just clears the pad,” Musk said.
Revenge is a dish best served cold. Former Intel president Renée James took her new startup, Ampere Computing, out of stealth mode on Monday. The company is designing microprocessors to run servers based on the low power ARM platform that powers most smartphones. That will put Ampere directly in competition with Intel and its highly profitable server CPU business.
Second place is for losers. The trial to determine whether Uber stole trade secrets from Waymo opened in San Francisco, with lawyers for both sides making opening statements. Recode offered a summary and highlights of the arguments. “We need to think through the strategy to take all the shortcuts we can find,” former Waymo exec Anthony Levandowski, who is alleged to have stolen thousands of confidential files, wrote to Uber CEO-at-the-time Travis Kalanick in one 2016 text message.
If you have nothing good to say. The head of the Bank for International Settlements, Agustín Carstens, is no fan of bitcoin and other digital currencies. If the “speculative mania” continues to grow, such assets could become “a threat to financial stability,” he warned in a speech on Tuesday. The remarks come a day after European Central Bank chief Mario Draghi called cryptocurrencies “very risky” and “entirely speculative.”
I am paying for this microphone. Election regulators in Seattle say Facebook violated rules requiring that a seller of ads in a local election disclose who paid for them. Such rules could become a national requirement if legislation known as the Honest Ads Act passes Congress. (Video explainer for pre Gen Xers.)
Stocks not the only things falling. The tablet market declined 8% in the fourth quarter from the same period in 2016, with 49.6 million devices shipped, IDC said. And while Apple held its top position for the 2017 holiday quarter, Amazon surpassed Samsung for second place. For the year, tablet shipments slipped 7% to 163.5 million.
You got your peanut butter in my chocolate. Something appears to be amiss with the email reports that Apple sends to app developers who use its app advertising service, TechCrunch reports. Some developers are receiving data about other developers’ apps.
FOOD FOR THOUGHT
Online commerce still makes up less than $1 out of every $10 in the United States, but everyone knows its share is growing fast and inexorably moving higher. Well, that’s not the view of Leslie Wexner, the CEO of mall favorite Victoria’s Secret. Brick and mortar stores will survive just fine as the infatuation with smartphones fades, he tells Khadeeja Safdar in a Wall Street Journal profile.
“We’re in the process of bouncing back from that,” he says in an interview. “I don’t think this is a new norm.”
People crave social interaction and will seek it at places like malls. “There are times when that gets interrupted, but people want to be with other people,” he says. “I’ve got 5,000 years of history on my side,” pointing to the ancient shopping bazaars in Rome and Istanbul.
Other certainties have been proven wrong, he argues. Frozen food didn’t wipe out restaurants. Landline phones didn’t end face-to-face conversations.
IN CASE YOU MISSED IT
Intel is Betting On Less With New Smartglasses By Sarah Gray
Disney Is Taking a Very Different Marketing Approach With ‘Solo: A Star Wars Story’ By Rachel King
A Possible Cure for Virtual Reality Motion Sickness By Jay Samit
Apple and Cisco Team Up on Cybersecurity Insurance By Jonathan Vanian
How VW Paid $25 Billion for ‘Dieselgate’ — and Got Off Easy By Roger Parloff
Why Qualcomm’s Stock Price Fell After Broadcom Increased Its Bid By Aaron Pressman
2 Men Have Been Charged With ‘Jackpotting’ ATM Machines in New England By Hallie Detrick
BEFORE YOU GO
Are you impressed when outfits like iFixit rip apart a six-ounce smartphone and guesstimate how much it cost to make? Car enthusiast web site Jalopnik visited Munro and Associates near Detroit, which kind of does the same thing—to cars.