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ICYMI | 万一你错过了| 당신이 그것을 놓친 경우에 대비해서

Reading Time: 2 minutes

WSJ City | Young Chinese Spending Creates Worrying Debt – looks like a credit bubble waiting to happen. Worrying debt in terms of personal credit doesn’t create economic value in the same way that government debt on infrastructure does. Chinese corporates also have worrying debt also has shades of bubble era Japan about it. Since consumer spending is driving China’s 6 percent growth, what would happen if the credit bubble burst?

Farewell to Those Days of Wrestling With Fate
Busy Chinese city life

A European Perspective on Boeing’s 737 MAX Debacle: An “Existential Crisis” for a National Champion | naked capitalism – Boeing’s Crashes Expose Systemic Failings – fascinating Spiegel article of which this pulls out the highlights

BangBros Acquires, Shuts Down PornWikiLeaks Site | AVN – this is about trying to stem the flood of doxxing that has beset performers in the adult entertainment industry and their families

Big Brands ‘Acting Like Startups’​ – A Potential Red Flag | LinkedIn – one for companies in FMCG space like Unilever to read. It points out the flaws in ‘disruption porn’ pedalled by McKinsey Digital and Accenture

WSJ City | Trans-Pacific Tensions Threaten US Data Link to China – also likely to affect Hong Kong as a financial centre and base for cloud network hosting

YouTube to adjust UK algorithm to cut false and extremist content | Technology | The Guardian – censorship. Interesting that there will be concern about China yet we’ve stepped on a slippery slope

Big brands turn to big data to rekindle growth | Financial Times – this makes me worry about the internal future state of research in large consumer companies

bellingcat – Amazon’s Online Bezos Brigade Unleashed On Twitter – If you’ve worked on Amazon social you might want to take it off your CV after reading this…

Nicolas Roope: “A different design language is taking over”The challenge is how brands can adapt their propositions. Architecture demonstrates the formality of this new direction: what is now a series of gestures and actions that may or may not be involved in the surface will be critical to the success of the project. How do these buildings respond to the urgent requirements of energy use reduction and waste reduction? How do they perform as stories in hyperconnected environments where reputations are established in social media? Think Instagrammable hotel rooms…

The Economist | China’s thin-skinned nationalists want to be loved and fearedZoe hit the jackpot. Over a million netizens responded to her poll, posted on Weibo, the country’s largest microblog platform, asking what followers think of foreign brands that “insult China”. Her timing was impeccable. Her survey surfed waves of patriotic indignation crashing over the Chinese internet, heightened by puffs of windy outrage in the state media. To give you an idea of how ridiculous it can sometimes be:

Big Blue Open Sources Power Chip Instruction Set – a really interesting opportunity opens up for a fully open source rival to ARM

Member Research: Away vs. Rimowa – 2PM – I’ve been a long time RIMOWA fan, but the pilot case I like has been discontinued

Mediatel: Newsline: Millennials finally get to neg someone else – gen-z seen as workshy egotists by gen-y

Beyond Techno-Orientalism: An Interview with Logic Magazine’s Xiaowei R Wang

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Five for Friday | 五日(星期五) | 금요일에 다섯 가지

Reading Time: < 1 minute

This video on the 1970s and 1980s Mercedes 300D is instructive in terms of the amount of work that was put into industrial design. What would now be called user experience in a more digital world.

Japan had a culture of non-fiction informational manga as well as the stuff that we’re used to seeing in the west. I’d not seen it done in anime before but ti works really well. Here is a short film made by the people that brought you Sailor Moon in the mid 1970s.

The social side of online computer games

Amazon is bringing Garth Ennis’ The Boys to the small screen. Karl Urban is a lean but less imposing Butcher and Wee Hughie ISN’T played by Simon Pegg….

South China Morning Post’s Abacus channels The Pixel Boys to try and bring China’s tech giants to life for westerners: China Tech City | Abacus 

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Automata Eve launch

Reading Time: 3 minutes

Automata Eve launched the other week and I got to go along to their headquarters just off the Pentonville Road to find out more.

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Automata Eve first impressions

At £5,000, the Automata Eve sits at a weird place in robot manufacture. It’s an expensive hobby device or a lightweight industrial product. Automata freely admitted that they sit somewhere between the £1,500 hobbyist kits and starter industrial models that are £20,000+ excluding arm tools, programmable control units and everything else required.

Automata Eve human friendly product design reminded me a bit of early Apple Macs. Their very product design sophistication made them look like ‘toys’ in the eyes of IT departments. Automata’s Eve is an equally polished appliance as robot and it might take a bit more effort to have it taken seriously in light industrial roles.

Eve even has a lopsided Picasso-esque face with two buttons on the top of the arm in a vertical manner.

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Maybe it needs a different colour palette of heavy plant yellow or yellow and black diagonal stripes better telegraph its industrial credentials.

The shadow of Brexit

Brexit afflicted sectors such as food preparation seem to be some of the people who have started to explore using Automata and rivals already. The companies realise that it will hard to get further workers from the likes of Stoke on Trent or Sunderland working on sandwich production lines. Robots are part of their plans to replace labour who decide to leave the UK. Automata assemble their robots in the UK, but their supply chain partners are half way around the world in Asia.

Pain is the mother of invention

The founders story reminded me a lot of the way that machine learning projects have historically been sold into clients by creative, digital and advertising agencies.

They used to work for Zaha Hadid Architects and had used algorithmic design. This gave Hadid’s work abstract yet organic lines. So when they were looking to use a series of interlocking panels, they expected that these could be mass-made and bent by robotics.

A bit like strategy and client services teams in agencies they over-estimated the capability of technology; in their case industrial robotics.

That plan didn’t go too well. Which got them interested in why there weren’t light industrial robotics. A good number of years later and the Automata Eve was born.

Industry robotics industry structure

What really surprised me was how industrial robots essentially use the same components and innovation tends to happen in the software instead. For instance industrial robots use a compact way of strain wave gearing.

Only a few companies make the components. This means that the industry is very horizontally structured like the PC or smartphone industries relationship between processor and software manufacturers.

Robots are already accurate enough to get rid of workers who don’t care

One of the case studies used in the presentation was about an industrial electronics company who replaced a human work station some pretty basic soldering.

For reasons that one could assume to be a lack of work ethic. By contrast Foxconn, seems to have failed in its efforts of using robots for smartphone assembly. The reason is that they require a high degree of dexterity, rather like a watch maker. Robots still struggle with very accurate placement, but a lot of low volume manufacturing tasks don’t necessarily need the same level of accuracy.

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Is it western companies, or China in a financial crisis? Part 2

Reading Time: 4 minutes

Apple and Jaguar Land Rover blamed the Chinese economy for their recent financial results. The truth is probably more complex. What factors are affecting affecting these businesses that aren’t directly related to the Chinese economy?

China is a unique mobile environment and in some ways it mirrors the hopes (and fears) for the internet in the late 1990s. Oracle and Sun Microsystems spent a lot of time during the dot com boom developing technologies that would allow applications to run on the web. Enterprise software sudden had a user experience that could be accessed via a web browser. Java allowed applications to be downloaded and run as needed. Netscape had a vision of the internet replicating the operating system as a layer that would run applications. Microsoft also realised this which was why they developed Internet Explorer, integrated it into Windows and killed off Netscape. The Judge Jackson trial happened and that was the start of the modern tech sector allowing Google and Apple to rise.

Move forwards two decades and most computing is now done on mobile devices. In China, WeChat have managed to achieve what Netscape envisioned. Their app as a gateway to as many services as a consumer would need including a plethora of mini applications. It doesn’t suffer the problems that native web apps have had in terms of sluggish user experiences. In addition, WeChat has invested in a range of high-performing start-ups to built a keiretsu of businesses from cab services, e-commerce, property companies and even robotics. In the meanwhile Tencent who own WeChat have a range of consumer and business services as well.

What this means for Apple is that many of its advantages in other markets are negated in China. The OS or even performance of a smartphone doesn’t matter that much, so long as it can run WeChat and a couple of other apps. The look and feel of the app is pretty much the same regardless of the phone OS. Continuity: where the iPhone and a Mac hand-off seamlessly to each other doesn’t matter that much if many consumers use their smartphone for all their personal computing needs.

This has been the case for a few years now in China – but Apple haven’t found a way around it.

As for phone industrial design – Apple lifted the game in manufacturing capability by introducing new machines and new ideas. To make the iPhone 5, Apple helped its suppliers buy thousands of CNC machines. This grew the manufacturers capability to supply and the amount of pre-owned machines that eventually came on the marketplace. It meant that other manufacturers have managed to make much better phone designs much faster.

That meant Chinese consumers can buy phones that are indistinguishable from an iPhone if you ignore the logo and function the same because of China’s app eco-system. Again this has been the same for a few years and has accelerated due to the nature of the dominant smartphone form factor. The second iteration of the iPhone X form factor is what really changed things. The phones were different to what has come before, but they weren’t demonstrably better. They were also more expensive.

In the mean time Huawei and others have continued to make progress, particularly in product design and camera technology – the two areas where Apple led year-on-year. Huawei devices can be expensive for what they are, but they gave domestic manufacturers ‘brand permission’ in the eyes of many Chinese consumers to be as good as the foreigners.

This wasn’t helped by Samsung’s missteps in the Chinese market that started with the global recall of the Samsung Galaxy Note7 battery recall. Samsung hasn’t managed to make that gap back up and seems to make marketing missteps regularly such as its recent tie-in with the ‘fake’ Supreme brand holder China. If you’re a Chinese consumer the additional value or status that you used to see in foreign handset brands is now diminished. This seems to be a wider theme as domestic brands are also making similar gains in market share compared to foreign FMCG brands. Although there are also exceptions like baby formula.

Domestic brands have done a good job marketing themselves. BBK in particular are very interesting. Whilst Huawei makes lots of noise and bluster at how big they are, BBK creeps up. It has a number of brands in China and abroad OnePlus, Oppo, Vivo and RealMe going after particular segments. The brands are focused but run separately like companies in their own right. Apple’s marketing riffs on its global marketing (though it did a great Chinese New Year themed ad last year). This reinforces the perceived common view that foreign businesses are full of hubris and don’t sufficiently localise for China. Apple’s recent pricing strategy in a market where this is so little to show in value provided looks like the epitome of hubris.

180120 - China smartphone market

Finally, there has been a massive amount of consolidation of brands in the China smartphone market over the past four years. That provides for scale in terms of logistics, supply chain, design, component sourcing and marketing.

If we move to the automotive sector and look at Jaguar Land Rover – their problems in China look self inflicted. China’s car market has declined for the first time in 20 years. But it seems to have mostly affected brands like Hyundai rather than prestige brands like Mercedes Benz or BMW. The reasons why aren’t immediately apparent. Yes diesel cars are less popular, but BMW, Audi and Mercedes make diesel cars.

Jaguar Land Rover aren’t the only foreign brand suffering: Toyota has had problems in China since the last round of strong anti-Japanese sentiment exploded in 2012.

More information

Why Does WeChat Block Competitors, While Facebook Doesn’t? | Walk The Chat

Apple’s China Problem | Stratechery

Samsung recalls Galaxy Note 7 worldwide due to exploding battery fears | The Verge

Samsung angers hypebeasts by partnering with fake Supreme brand in China | The Verge

Fake News: Samsung China’s Deal With Supreme “Knock-off” Spurs Drama | Jing Daily

Chinese car sales fall for first time in more than 20 years | World news | The Guardian

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Five for Friday | 五日(星期五) | 금요일에 다섯 가지

Reading Time: < 1 minute

Things that made my day this week:

I’d been tuning things out whilst working with my headphones and listening to:

Puma have got on the K-Pop bandwagon to sell sneakers to Indonesians

A vintage advert from Apple that was all about storytelling through its customers. What’s On Your PowerBook

What's On Your PowerBook?

Nike have launched a more polished looking self lacing trainer fulfilling the promise of the future from the film Back To The Future 2. They also did a good video that discusses the design of the Nike BB Adapt sneaker

Pretty much everyone and their dog has shared their opinion on Gillette’s virtue signalling advert on toxic masculinity – so I feel no reason why I should anything to the discussion. Instead, check out this Bosch ad that I got through my friend Ian. Where do you start with it? I am sure that there would be a lot of raised eyebrows in Germany over it.