Cold Takes

(Originally published on Cold Takes, my newsletter — more about it here.)

Well, this newsletter just went from a few people reading it the past few weeks to a few hundred. No pressure :)

First off, thanks to all of your who subscribed on day one. Will try not to let you down. As noted in my preamble yesterday, I still don’t have a set cadence to publishing this, but I know predictability and reliability are important. So bear with me as I figure this out…

But, sincerely, thank you again for coming along for the ride.

Top of Mind

A fun one this morning from the Financial Times (which, of course McLaren denies). You’ll forgive the slightly hotter take than usual — it’s just too good to pass up.

First of all, while it’s easy to snark — as I have and will! — this may not be the craziest deal in the world given how serious Apple is with regard to the car project. If the FT is right, and the deal would be between £1B and £1.5B (basically $1.3B and $2B) this would be pretty “cheap” for Apple. Cheaper than say, buying Tesla, which has a market cap of around $30B (which Apple would have to pay a premium on top of, of course).

Also, jokes aside, given that McLaren is a British company, Apple could use some of its overseas cash (which is almost all of its cash on hand at this point) to buy (or invest in) the company. And better to do that sooner before they inevitably repatriate that money (at a lower tax rate, of course) next year.

Such a hypothetical deal strikes me as almost Beats-like: a lot of glitz on the surface, but underneath, there’s probably a few things Apple really cares about. First and foremost would be car design and engineering expertise. (Same with Beats: music and streaming expertise.) Second, they’d get a premium brand. (Same with Beats.) Third, they get some revenue — something between $300M and $600M, according to the reports — which isn’t nothing, but not meaningful to Apple (same with Beats).

And then, as Matthew Garrahan and Tim Bradshaw report:

“A tie-up with McLaren, whose expertise ranges from automotive engineering and on-board computer systems to novel chassis materials such as carbon fibre and aluminium, could accelerate Apple’s secretive automotive project.”

They had Jony Ive at “aluminium.” They had Eddy Cue at fancy sports car. And they had Phil Schiller at McLaren. Now I’ve totally talked myself into it, it’s hard to see Apple not doing this deal. Apple Car Edition here we come!

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Not to scale.

5ish Links

Lucas Shaw:

“Retail spending on recorded music grew 8.1 percent to $3.4 billion in the first half of 2016, according to a draft midyear report from the Recording Industry Association of America that was obtained by Bloomberg News. That means the U.S. industry is on pace to expand for the second straight year — the first back-to-back growth since 1998–1999.”

That’s pretty crazy, but looking at the chart (below), it’s also crazy that the business is stabilizing around where it was in 1990. And even more interesting is that this is roughly double (or more) where the business was at in the 1970s — what many would consider to be the heyday of recorded music.

I remain confused as to why exactly we think a huge industry of people paying for music is the norm. This seems more like an anomaly. Certainly it is in the history of humanity. And the late 1990s/early 2000s seems like a total outlier during the CD boom. Thinking outside the box seems like a much better key when it comes to making money. And touring, of course.

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Back-to-back “growth” in context

Speaking of dying media… Everyone seems shocked, shocked that the Emmys got such a low rating. I’m shocked they ever got good ratings — at least the Grammys has musical performances. And the Oscars have history/nostalgia — and far more glitz and glam. I’m sure you can chalk some of this up to changing viewing habits. But I think a large part is also that it’s just not very compelling television.

Shelly Banjo:

“The most interesting thing the survey found, however, was that the top reason consumers gave for shopping on Amazon was ‘ease and convenience,’ followed by ‘Prime free 2-day shipping.’ In other words, the sexiest part of Amazon’s fashion push was not the clothes on its site but its logistics.”

This was always inevitable. Not for everyone, but for a huge swath of people. If they’re already buying everything on Amazon, why not buy clothes as well? It’s right there. Just as it has been at Walmart, currently America’s largest apparel seller.

From the Portfolio

Fun to see The Economist (which I read religiously at this point) do a profile on Medium.

500ish Words

Some more thoughts as to why I’m doing this newsletter.

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Until next time…

(Originally published on Cold Takes, my newsletter.)

Written by

General Partner @ GV (née Google Ventures). In past lives I wrote at TechCrunch, VentureBeat, and ParisLemon. A man of few words. Except when writing. 🍻

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