Thursday Nov.07, 2019

Uber Eats delivers "Browsing Billboard"

_"Which one of you wants the Uber ad job?"_
_"Which one of you wants the Uber ad job?"_

Hey Snackers,

CEO role = Vacant.

Chief exec departures hit a fresh high last month (172 exited their posts) — we're on pace for a record year of CEOs leaving/losing their positions.

Stocks inched down Wednesday, but today we're waiting for Disney's earnings report to magically appear.

Ads

An Uber Eats job post reveals it's about to add digital billboards to its app

New job posting: Ads Lead...Responsible for creating a new ads business that enables eaters to discover new foods.” TechCrunch reporters noticed that up on the Uber Eats career page. It's a signal that instead of taking just a delivery fee off your late-night chimichanga order, Uber is adding a new revenue stream from the prime real estate at the top of its Uber Eats app.

We're calling it a "Browsing Billboard"... As your fingers browse Uber Eats for dinner, your eyes will see a billboard. The app's valuable space highlighting food options can be sold as ads to restaurants that crave better delivery sales. Here's how Uber Eats' Browsing Billboard would go down:

  • You: Starved for saucy pizza, but don't want to get up. So you open the Uber Eats app.
  • The list: Before, the top 5 NYC pizza joints delivering to you featured Di Fara's, Pasquale Jones, Lil' Frankie's, Dani's, and Emily. They're at the top of the list because of their ratings.
  • The (future) list: Soon, that top spot might be occupied by Pizza Hut (with the word "sponsored" in small letters underneath). It's at the top of the list because it paid for it.
  • Uber: Makes money selling ads, just like Google does on Google search.

The Browsing Billboard is the next evolution of platforms... Web platforms like Uber play a middleman role, connecting buyers with sellers. Expedia plays that role too — but when you search for vacation options, some of the top results are paid ads. And more platforms could start doing that:

  • Spotify's platform for music discovery could start making money by promoting artists that pay for it.
  • Apple's podcast store could make $$$ the same way.
  • Tweet us your own ideas for potential Browsing Billboards @RobinhoodSnacks.
Price

Kroger rebrands itself in every way (and might add "dynamic pricing")

Feel like the Lannisters in Season 7?... Kroger is a seasoned grocery biz vet, founded 136 years ago in Cincinnati by a German immigrant's son. Now it's facing competition from German discount grocers Aldi and Lidl, which are expanding rapdily into the US. Amazon, Walmart, and Target all got in on groceries, too. Doing nothing isn't an option anymore for Kroger, so it's changing everything:

  • The project: "Restock Kroger" is what they're calling it (great inventory inside joke). We call it "Operation don't-go-out-of-business."
  • The changes: Adding Walgreens stores within its stores, delivering with Instacart, and buying back $1B of shares (to thank investors for their patience). It also acquired a meal kit company.
  • The rebrand: "Fresh for Everyone" is the new slogan — that'll be trumpeted by the "Kroji," the (new) emoji-ish, post-racial mascots of Kroger.

"Dynamic pricing" could be up next for groceries... Kroger also recently partnered with Microsoft on a project that includes replacing old price labels with digital ones. That got us thinking: "dynamic pricing" could be coming. AKA pricing that can change based on supply/demand (like Uber's surge pricing). If Kroger can control and changes prices instantly thanks to these stickers, it could...

  • Raise prices when something is almost out of stock, to ensure that the person who gets the last jar really wants it.
  • Lower prices when there's too much of something, to prevent food from going bad.
  • These changes could reduce waste, increase revenue, and make Kroger more efficient. And if Kroger's not thinking about it, Amazon almost definitely is.

What else we’re Snackin’

  • Spritzy: Bud Light (owned by AB InBev) is making a spiked seltzer that tastes like White Claw — and now we know it will look like White Claw, too
  • Friends-giving: Tesla's Elon Musk claims its new electric pickup will be dubbed "Cybertruck" and unveiled on November 21st
  • De-vaped: Juul's situation gets worse after San Francisco voted to maintain its ecigarette ban in the ecigarette-maker's hometown
  • Team: Costco and Instacart jump in together on the Delivery Wars by testing a 1-hour delivery option for your meds
  • Sneaky: Amazon's apparently got workout-tracking software hidden in its new Echo Buds earbuds (fyi @Google @Fitbit)
  • Disappeared: WeWork and Uber lost their shared investor Softbank a combined $8.9B last quarter

Thursday

Disclosure: Authors of this Snacks own shares of Amazon and Tesla

ID: 1005541

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Power

World out of balance: It costs the US 3¢ to make 1 penny

The cost of producing the US penny rose 13% in fiscal 2023 to 3.07 cents. Yes, that means that Uncle Sam loses more than two cents for every cent it produces. (And no, you can’t make it up on volume.)

For the record, that’s the 18th-straight year the penny’s face value has been below production costs, fueling calls for abolishing the lowest value denomination coin. Canada started to phase out the penny in 2013, joining Australia, Brazil, Finland, New Zealand, Norway, and Israel, according to Smithsonian Magazine.

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Business

Netflix is going to stop sharing subscriber numbers

After posting subscriber numbers that beat expectations today, Netflix says it’s no longer going to share those numbers starting in the first quarter of 2025. That’s a big deal since subscriber numbers have long been one of the main metrics that investors have looked at.

“In our early days, when we had little revenue or profit, membership growth was a strong indicator of our future potential,” its shareholders letter read. “But now we’re generating very substantial profit and free cash flow.” The company said that it will focus on revenue and operating margin as its main financial metrics, while it will look at time spent on the platform to gauge customer satisfaction.

Another way to read this? They’ve hit market saturation and just aren’t going to be growing that much anymore, and they thought they’d end on a good note. Going forward they’re focusing on how to get more money out of the customers they do have.

They’re doing so by cracking down on password sharing and charging for extra members. They’re also pushing people to ad tiers, which are more profitable than non-ad tiers.

“Scaling ads to become a more meaningful contributor to our business in ‘25 and beyond,” Netflix said.

Netflix’s ads membership grew another 65% in Q1 over the previous one, after rising 70% the quarter before, and 40% of signups in ad markets continue to be for those ad plans.

Tech

Meta’s not telling where it got its AI training data

Today Meta unleashed its ChatGPT competitor, Meta AI, across its apps and as a standalone. The company boasts that it is running on its latest, greatest AI model, Llama 3, which was trained on “data of the highest quality”! A dataset seven times larger than Llama2! And includes 4 times more code!

What is that training data? There the company is less loquacious.

Meta said the 15 trillion tokens on which its trained came from “publicly available sources.” Which sources? Meta told The Verge’s Alex Heath that it didn’t include Meta user data, but didn’t give much more in the way of specifics.

It did mention that it includes AI-generated data, or synthetic data: “we used Llama 2 to generate the training data for the text-quality classifiers that are powering Llama 3.” There are plenty of known issues with synthetic or AI-created data, foremost of which is that it can exacerbate existing issues with AI, because it’s liable to spit out a more concentrated version of any garbage it is ingesting.

AI companies are turning to such data because there’s not enough good, public data on the entire internet to train their increasingly greedy AI models. (Meta had reportedly floated buying a publisher like Simon & Schuster to satisfy its insatiable data needs.)

Meta, of course, isn’t the only company that’s tight-lipped about where its AI data is coming from. In a now infamous interview with WSJ’s Johanna Stern, OpenAI’s chief technology officer Mira Murati was unable to answer questions about what Sora, OpenAI’s video generating app, was trained on. YouTube? Facebook? Instagram — she said she wasn’t sure.

What is that training data? There the company is less loquacious.

Meta said the 15 trillion tokens on which its trained came from “publicly available sources.” Which sources? Meta told The Verge’s Alex Heath that it didn’t include Meta user data, but didn’t give much more in the way of specifics.

It did mention that it includes AI-generated data, or synthetic data: “we used Llama 2 to generate the training data for the text-quality classifiers that are powering Llama 3.” There are plenty of known issues with synthetic or AI-created data, foremost of which is that it can exacerbate existing issues with AI, because it’s liable to spit out a more concentrated version of any garbage it is ingesting.

AI companies are turning to such data because there’s not enough good, public data on the entire internet to train their increasingly greedy AI models. (Meta had reportedly floated buying a publisher like Simon & Schuster to satisfy its insatiable data needs.)

Meta, of course, isn’t the only company that’s tight-lipped about where its AI data is coming from. In a now infamous interview with WSJ’s Johanna Stern, OpenAI’s chief technology officer Mira Murati was unable to answer questions about what Sora, OpenAI’s video generating app, was trained on. YouTube? Facebook? Instagram — she said she wasn’t sure.

Today’s earnings: Who’s making money edition

Here are some some notable numbers out this morning, as earnings season gathers steam. Thursday’s main event will be Netflix after the close of trading. (Keep an eye on its advertising business.) But until then...

7.13%

The 30-year fixed rate mortgage is back above 7%, according to weekly numbers from the Mortgage Bankers Association, the highest level in four months. High borrowing costs are creating havoc for would-be buyers, as affordability lingers at the low levels not seen consistently since the late 1980s.

Business

Amazon’s spy ops on rivals: shell companies, printed docs, and a fake Japanese streetwear brand

Some companies check out rivals’ websites, stores and public filings to stay abreast of the competition. Amazon made its own fake shell company and brands, transacted hundreds of thousands of dollars per year undercover on competitors’ platforms, and kept its intel operation a secret for nearly a decade even from others at Amazon, according to a fascinating investigation by the Wall Street Journal.

Working as a seller called Big River, a secret group of Amazon employees gained access to rival platforms, including Walmart, FedEx, and Alibaba. They used Big River email addresses and went to seller conferences as Big River employees. They even stayed hidden within Amazon itself. These employees would take screenshots of competitors’ systems that they would then show others at Amazon in person to avoid an email paper trail.

Perhaps most strange of all, the company created a fake Japanese streetwear brand called “Not So Ape” (clearly a play on A Bathing Ape) and continues to sell products from the brand on a Shopify store, presumably as an attempt to learn the inner workings of the shopping platform. Of course, copying is old hat for Amazon.

In meetings where they’d use this clandestine information to inform Amazon’s own business practices, the group resorted to literal paper. “[T]he team avoided distributing presentations electronically to Amazon executives. Instead, they printed the presentations and numbered the documents. Executives could look at the reports and take notes, but at the end of the meeting, team members collected the papers to ensure that they had all copies."

Working as a seller called Big River, a secret group of Amazon employees gained access to rival platforms, including Walmart, FedEx, and Alibaba. They used Big River email addresses and went to seller conferences as Big River employees. They even stayed hidden within Amazon itself. These employees would take screenshots of competitors’ systems that they would then show others at Amazon in person to avoid an email paper trail.

Perhaps most strange of all, the company created a fake Japanese streetwear brand called “Not So Ape” (clearly a play on A Bathing Ape) and continues to sell products from the brand on a Shopify store, presumably as an attempt to learn the inner workings of the shopping platform. Of course, copying is old hat for Amazon.

In meetings where they’d use this clandestine information to inform Amazon’s own business practices, the group resorted to literal paper. “[T]he team avoided distributing presentations electronically to Amazon executives. Instead, they printed the presentations and numbered the documents. Executives could look at the reports and take notes, but at the end of the meeting, team members collected the papers to ensure that they had all copies."

Crypto
Jack Morse
4/17/24

Worldcoin pivots to the blockchain… with a 'humans only' discount

Worldcoin, the “proof of personhood” crypto project launched by OpenAI’s Sam Altman, said it plans to launch its own ethereum layer-2 (L2) blockchain dubbed World Chain. The pitch: a blockchain where it’s both easier and cheaper for people to transact than bots.

Worldcoin has made waves for its iris-scanning metallic orb that promises a future where people can mathematically prove they’re real humans and not AI bots.

But it’s run into trouble: the orbs have been banned across Europe and Africa, and the associated WLD crypto token has plunged 50% over the past month.

For project insiders, who reportedly received a token allocation of 25% of supply, that could equal significant losses. 

Which is what may make World Chain attractive. Crypto exchange Coinbase launched its own L2, Base, last year. Base has since seen rapid user growth — activity that’s generated the exchange millions of dollars in weekly fees

Worldcoin could benefit from similar revenue if its L2 is adopted around the world.

But it’s run into trouble: the orbs have been banned across Europe and Africa, and the associated WLD crypto token has plunged 50% over the past month.

For project insiders, who reportedly received a token allocation of 25% of supply, that could equal significant losses. 

Which is what may make World Chain attractive. Crypto exchange Coinbase launched its own L2, Base, last year. Base has since seen rapid user growth — activity that’s generated the exchange millions of dollars in weekly fees

Worldcoin could benefit from similar revenue if its L2 is adopted around the world.