TRANSCRIPT:
We hold our feet to the fire and revisit our January 2017 predictions regarding the upcoming year. A prediction we made Twitter will increase in relevance and decrease in value. Sort of right, sort of wrong.
Twitter’s gained relevance but its stock is also up. A prediction: Verizon will walk from or shave $1 billion plus from the purchase price of Yahoo as they recognize they may be inviting Mr debt the mother of all liabilities into their house. An honorable mention: Verizon shaved $350 million from the purchase price of Yahoo and the deal closed.
Prediction: hacking phishing schemes and ransomware will reach crisis proportions and take center stage in Congress. So we got this one right. Equifax, Uber, the SEC, and Chipotle among others were hacked — seriously hacked.
Prediction: we will see enormous write-downs from Unilever and Walmart’s acquisition of Dollar Shave Club and jetcom respectively. Wrong mostly: Walmart’s acquisition of jetcom was not only not a writedown but it’s likely turning out to be a genius acquisition.
Was jetcom worth $3 billion? No. Was it worth more than three billion dollars to Walmart? Yes. Walmart likely the retailer up 2017 has been able to report year on year ecommerce gains of 60 plus percent. Likely adding tens of billions of dollars to its market capitalization.
Prediction: Amazon having bested Apple and Google and voice and machine learning will run a successful test for 0 click retail. We’re a little early on this but it’s looking good. Amazon Prime wardrobe sends clothes you can try on and decide if you want to buy. The firm is now the fourth most valuable company in the world and its stock was up 50 percent in ’17.
Prediction: Netflix becomes the operating system for the other screen in our life: television and becomes the fifth Horseman. Share price doubles or is acquired by one of the horsemen or Disney.
We were mostly right here. Netflix is becoming the operating system for television and its stock was up 50% in ’17.
Prediction: Pinterest value will fall 50 plus percent as weak management and turnover again to metastasize. We got this wrong. We don’t know what the value is, it’s a private company but it wasn’t cut in half.
Prediction: Airbnb becomes the most disruptive private company other than Amazon and business and has the IPO everyone that’s expecting from Snap. By the end of the year, the firm is worth more than Uber. Sort of not really. At the beginning of 2017, Uber was valued four times Airbnb; Airbnb’s next round may approach or even past the most recent valuation on Uber. It’s been a great year for Airbnb and one for Uber.
Prediction: wework losses seventy-five percent of its value from peak, 16 billion, and becomes a poster child of unicorn mania wrong. wework has announced a bunch of innovative pilots that are going to extend the consensual hallucination between the firm and the markets.
Prediction: Snapchat will not go public as it becomes evident they are losing tractions at the hands of Instagram. So so, Snap did get out, but its stock has been cut in half and is screwed. The Zuck owns four of the five top non gaming apps globally and all four have their guns squarely pointed at what is the name of that company? Snap.
And now our predictions for 2018. The break-up of big tech begins. Wage growth fails to materialize and someone does the math highlighting that the heirs of Walton, Bezos, Zuckerberg, Gates, Brin, and Page will soon be worth more than two-thirds of US households combined.
Prediction: Amazon passes Apple in value.
Prediction: Alexa emerges as the iPhone of the next decade fueling Amazon to ascend past 1 trillion in market capitalization; voice makes the mobile wars look like a border skirmish as big tech and the media industry try to establish their place in an increasingly Amazon world.
Cryptocurrencies crash by over 50% in a month. That’s pretty — that’s a pretty wimpy prediction, but it’s likely going to happen in the first quarter. It will then rock it past 20,000 dollars as crypto, specifically Bitcoin, has become a Chaos proxy and we are headed towards a constitutional crisis, which will confirm the Millennials are smart to not have trust in their institutions or the Federal Reserve.
Prediction: the ad tech landscape goes from bad to worse as the industry’s duopoly, Facebook and Google, cements the industry structural decline. Large communications conglomerates had twenty to fifty percent of their value when their growth engines digital agencies stall as again the duopoly begins making online creative and value-added services less valuable.
Twitter, Snap, BuzzFeed, and Pinterest are acquired or valued in subsequent rounds for between 25 and 50 percent less than their market highs as all continue to underwhelm at the hands of the duopoly. Almost every digital marketing content darling — refinery29, AppNexus, etc — becomes a distressed asset. M&A activity hits a fever pitch of horizontal and vertical tie ups as industry bulks up in response again to Amazon.
Online furniture firm wayfair shares crash. A dot-com business model implodes as weak customer loyalty, Amazon private label furniture brands, and strong offline brands including William-Sonoma and RH take the firm to the woodshed. This firm wayfair is beginning to look increasingly like Blue. Apron Amazon acquires either Nordstrom carrefour, won’t acquire Target. Walmart establishes a leadership position in online grocery with pickup.
Everyone else including Target and Amazon has wrongly focused on delivery. This puts even more pressure on traditional brick-and-mortar retail and forces Kroger to make a big acquisition. My guess: instacart are possibly UK best ocado. Large CPG firms will either merge or forward integrate and acquire retail as they realize a voice-controlled world is really really bad for them. Disney becomes the fifth horseman.
Disney is the only old economy firm with the scale, stones, access to capital, and leadership to develop a prime-like offering. Disney will offer a prime Netflix-like member offering that will include a fat bundle of video programming and preferred access to other assets including cruises, parks, and the likes. The stock outperforms its peers and becomes the first old economy firm to take on big tech.
Facebook stock peaks. The Zuck becomes the unwitting poster child for the movement against big tech as a series of half-measures in response to the Russian interference and the launch of a gateway drug — a social media platform for kids — burnish his reputation as the most tone-deaf CEO in tech.
Business will continue to grow, but multiple erosion will occur due to the threat of regulation. A nation in Europe bans one or more of the four, opting for the Chinese model of stealing the IP, propping up a local entrepreneur, and capturing the value domestically.
Time’s 2018 Person of the Year? Robert S Mueller III, third Marine division Vietnam 1969, no bone spurs. And finally, the world continues to be a better place.
Infant mortality, the likelihood of death at the hands of another human, deaths from infectious disease, and wealth inequality between the poorest and wealthiest nations continues to decline. The number of girls attending college, global income, and great original scripted television continue to increase. We’ll see you next week.
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