Facebook Live: The Good, The Bad, The Ugly, Plus Most People Don’t Actually Want Smart Homes

by 2 years ago

morning brew
Enjoy your March 7th hand-crafted Brew!

QUOTE OF THE DAY 

“But indeed the Volkswagen brand is struggling to find its way in the future” — Matthias Mueller, chief executive of Volkswagen, admitting that there are many challenges ahead for the German automaker. Not something you hear every day from a CEO.

Market Snapshot

  • U.S. markets closed lower as investors price in rising geopolitical risks after North Korea tested four ICB missiles
  • The materials and financial sectors led broad markets lower, but one of the biggest losers on Monday was Snap Inc., which plummeted 12% to finish lower than where it closed on the day of its IPO
  • European markets didn’t fare any better, taking a fall after China adjusted its growth forecasts. Banking stocks also fell, with Deutsche Bank being one of the hardest hit after it announced it would be raising $8.5 billion in capital

Trimming the Fat

…ESPN will reportedly lay off some writers and on-air personalities. Uh-oh. Layoffs are nothing new at ESPN: in 2015, 300 employees were cut from the network, but most served in behind-the-scenes roles. Now, no job is safe. The news comes just a month after ESPN’s parent company, Disney (-0.51%), missed revenue expectations in large part due to a drop in ad revenue from ESPN. The Worldwide Leader in Sports has been struggling mightily: it’s failing to retain subscribers and is losing close to a billion dollars a year. But don’t worry Brewers, March Madness will still go on as planned (it helps that CBS owns the rights to March Madness, not ESPN).

Trump’s Been a Fan of GM

…But he might not be too happy after yesterday. The auto giant announced that it will be slashing 1,100 jobs in Michigan amid a downturn in demand for cars. This will be GM’s fourth round of layoffs (totaling 4,400), despite its pledge to invest $1 billion in U.S. jobs in January. Don’t worry too much though—General Motors has been putting the U.S. economy on its back lately, adding over 8,000 domestic jobs since 2015.

Exxon Brings Oil Back Home

…With a $20 billion, U.S.-based expansion in the pipeline. The massive oil producer (+0.45%) has clearly been scheming, announcing yesterday that it will invest in 11 different refineries and chemical plants along the Gulf Coast through 2022. According to Exxon’s CEO, the projects will yield plenty of job creation, including 12,000 permanent jobs. Not too shabby. One key takeaway? Exxon’s ambitions show that the U.S. is indeed working its way back to the center of the global energy industry. Following Exxon’s announcement, the Donald was naturally pleased, describing the project as “a true American success story.”

Facebook Live: The Good, The Bad, The Ugly

…No one really knew what was coming. After receiving a product update on Facebook Live last year, Mark Zuckerberg had 100 employees plucked from across the company to work on launching Live in time for April. The catch? They had just two months to do it. And with rushing, comes human error. The product certainly presents a new potential revenue stream and a new way for Facebook’s 1.3+ billion users to engage. But it’s also shown that not even Facebook foresaw the dangers—among them, over 50 violent streams including gruesome murders and suicides that highlighted clear gaps in Facebook’s content review procedures. There’s no better way to spook advertisers. Looks like Facebook’s got quite a year ahead.

Other Stories

  • GOP unveils healthcare bill to repeal and replace ACA
  • Transportation company CSX hires Hunter Harrison as new CEO
  • Mercedes to build the world’s most expensive SUV
  • Honda invests $159 million in two U.S. plants

Economic Calendar

  • Monday: Factory Orders (+)
  • Tuesday: Boingo Wireless, Dick’s Sporting Goods, H&R Block, Urban Outfitters Earnings; Consumer Credit
  • Wednesday: Adidas, Vera Bradley Earnings; Private Employment Report
  • Thursday: Domino’s, El Pollo Loco, Signet Jewelers Earnings
  • Friday: Vail Resorts Earnings; March Jobs Report, Treasury Budget

Water Cooler

Humans Just Aren’t Turned On By Connected Homes

Before we get into it, let’s start with the definition—what even is a connected home? Essentially, it’s an integrated setup where all appliances, temperature and lights are connected, allowing the owner to control these things remotely (via an app or a time schedule). But it seems that these smart homes aren’t the thing of the future just yet:

  • Three-quarters of people in a poll from Gartner said they are happy to set the temperature and lighting in their house manually rather than having gadgets predict their needs.
  • Based on that fact, it’s not surprising that only 10% of houses currently have connected home solutions.
  • So why are connected homes so unpopular? People just don’t see the convenience in turning on their coffee machine or raising their blinds with an app. 58% said they prefer independent devices (instead of connected ones) like conventional knobs and dials.
  • It’s not like this for all integrated home solutions. Take home security alarm systems, which have almost double the adoption rate (18%). Despite the lack of popularity, Google and Apple promise that it’s only the beginning. We’ll just have to wait and see.

The Breakroom

Interview Question of the Day

How can an investor evaluate the leverage of an insurance company? (Answer)

Startup of the Day

Jay Z is at it again. This time he has launched Arrive, a venture capital firm to offer capital and assistance with business development, such as branding. What’s so special about Arrive? It will be able to leverage Roc Nation’s exposure with artists and athletes—and most importantly, brand building. AKA, real-world experience that consumer-focused startups will salivate over. As Jay Z said in ‘You Don’t Know,’ “smarten up, open the market up.”

Food for Thought

Given its great success, Uber’s sharing economy model has had its share of imitators. Heal is a new healthcare company that looks to “transform the broken healthcare system” by freeing doctors from high administrative costs and helping patients get convenient care. The California firm has captured investments from the likes of singer Lionel Richie and Qualcomm executive Paul Jacobs, and is already part of large insurance networks like Aetna and United Healthcare.


TAGSBusinessFinanceMorning Brew

Join The Discussion