Ged Carroll

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  • 911 restomod + more things

    911 restomod

    Perfect Porsche? This British-built 911 restomod comes close : CityAM – the idea of the perfect Porsche is contextual and highly personal. I would prefer a car that looks like an early air-cooled car, with no aerodynamic spoiler or flared arches and Fuchs wheels. There are a number of vendors doing a restomod 911. US company Singer is probably the most famous with its muscular looking restomod 911 models. In the article, there is a particularly interesting bit is about the redistribution of parts and lightweight replacement parts in the 911 restomod by Theon Design.

    China

    EXCLUSIVE China’s Ant explores ways for Jack Ma to exit | Reuters – this looks as if its much more focused on Jack Ma and possibly his links to the Jiang Zemin faction. Ma may not be even keeping the money

    Chinese censors take aim at former premier Wen Jiabao’s essay | Financial Times – really interesting that this appeared in a Macao publication, like it was designed to give it a few days out there. Wen was generally a bit more soft-hearted than Hu when the two were in the politburo. And Hu was moderated by the committee approach of the politburo. Xi had learned from Bo Xijlai that populism and nationalism worked and has a hawkish view that is untempered by the politburo.

    Consumer behaviour

    Siu mai or egg waffles? Hong Kong foodies cut through political divide to share reviews, photos in online ‘concern groups’ | South China Morning Post – it also reflects a deepening sense of localism in the community, but in a harmless way – food speech instead of free speech

    China’s keyboard warriors like to fight . . .  each other | Financial Times – China’s grassroots nationalist bloggers seem less like that unified “main force” than dispersed militias which argue with one another as much as they do with external enemies. “The difference between Chinese nationalist factions is probably bigger than the difference between all of them and an American patriot,” says one Beijing-based blogger who is researching a book on Chinese internet culture. And while the CCP’s professional trolls may generate reposts and likes, “volume is not influence”, he adds – interesting article. I keep thinking about how different red guard groups used to fight against each other during the cultural revolution

    Design

    Trapped on Technology’s Trailing Edge – IEEE Spectrum – Repairing the system entailed either redesigning a few circuit boards and replacing other obsolete integrated circuits for US $21 million, as the B-2 program officers chose to do, or spending $54 million to have the original contractor replace the whole system. The electronics, in essence, were fine—they just couldn’t easily be fixed if even the slightest thing went wrong. – which makes me wonder about the internet of things.

    Luxury

    Why Chow Tai Fook sees opportunity in rural China and lower-tier cities | Marketing | Campaign Asia – Surrey Pau, deputy general manager of Chow Tai Fook Jewellery Group, responsible for market expansion, explained how and why the brand intends to seize opportunities in China’s fourth-and-fifth-tier cities, despite a natural bias in the sector towards selling luxury items to tier-one markets. Charts comparing urban (blue) and rural (yellow) growth rates Growth in rural China “Some people believe that in rural areas you don’t have much of an income, that you rely heavily on agriculture and have a very simple economic structure,” Pau said. “However we believe that is just a myth.” Comparing household consumption and spending trends in rural and urban areas, Pau sees the countryside soon catching up with cities, helped by government support to rural areas. And along with higher incomes, the brand is seeing people shift to devoting more disposable spending to lifestyle improvements, including cosmetics and jewellery. The other macrotrend is the massive rise in ecommerce spending. And thanks to recent infrastructure investments in new networks, the digital playing field has been levelled to a great degree in China – I don’t think that there’s the growth in Chinese lower tier cities and rural areas that Chow Tai Fook thinks

    Marketing

    6 Elements Of Digital Brand Dominance | Branding Strategy Insider – The old adage “stick to your knitting,” for example, a colloquial version of “build on your core competence,” tends to narrow a company’s imagination. Yet a bold imagination is a requirement for leaders today. Netflix, Amazon, Facebook, and Google would not be what they are if their CEOs and executive teams had not imagined a future that did not yet exist. – but do these businesses also suffer from a lack of focus and a conglomerate discount at some point?

    Media

    Leaked ByteDance Memo Shows Blockbuster Revenue Projections – Bloomberg – convenient that this happened ahead of Hong Kong listing…

    Myanmar

    Activists have launched a pirate radio station out of secret safehouses in Myanmar – Rest of World – probably radio because of the disruption to the internet – Myanmar’s army is sending the country “back to the ’90s” – Rest of World

    Online

    Son’s SoftBank Vision Fund Profit Nears $30 Billion on Coupang – Bloomberg – of course Softbank needs to be able to cash out to realise the win

    More than half of Instagram influencers ‘engaged in fraud’, with 45 per cent of accounts ‘fake’ | PR Week – Instagram mega-influencers and celebrities – those with more than one million followers – were the worst culprits, with two-thirds (66 per cent) of these accounts engaged in some form of fraudulent activity. 

    Nano-influencers – those with 1,000 to 5,000 followers – had the lowest proportion of fraud, occurring in 42 per cent of accounts. The most common tactics used included buying followers, likes and comments from click farms, buying story views, and engaging with comment pods – where a group of Instagram users get together and systematically engage with each other’s posts

    Security

    Huawei had unlimited access to millions of customer data from Telfort – NOS  – translation of Dutch original, more here – Dutch telecoms firm KPN: no sign Huawei has improperly monitored users, Telecom News, ET Telecom 

    Technology

    China’s Dystopian “New IP” Plan Shows Need for Renewed US Commitment to Internet Governance – Just Security – hinges around real ID and total surveillance

    Arm Battle With China CEO Escalates, Complicating SoftBank Sale – Bloomberg – I wouldn’t be surprised if China was pushing this to wrestle control of the group as part of its ‘war by other means’. I wonder if this news is connected – UK Forces Delay in Nvidia’s ARM Takeover, Citing National Security Concerns – ExtremeTech 

    US and Japan to invest $4.5bn in next-gen 6G race with China – Nikkei Asia 

    Wireless

    Lycamobile names CEO to lead digital push beyond expatriates | Financial Times – they’ve tried to do this previously. Lycamobile was usually the first SIM that EU migrants got to establish themselves in the UK. They then moved on to domestic aimed products. Brexit has made this move a life or death struggle now

    Verizon, AT&T, and T-Mobile kill their cross-carrier RCS messaging plans | Ars Technica 

  • Conglomerate discount

    Conglomerate discount wasn’t a concept that I was that familiar with. Conglomerates had gone out of style in the west during the 1960s to the 1990s.

    Western conglomerates

    Classic conglomerate examples would be

    • GEC
    • ITT
    • Litton Industries
    • Lonhro
    • Teledyne
    • Textron

    Spivs and financiers bought in and broke them up into their constituent parts. Or a new CEO would do it themselves to focus on core competencies and release value for shareholders.

    Conglomerate discount

    A conglomerate discount is when the stock market values a diversified group of businesses and assets at less than the sum of its parts. This is because investors are worried about the management not being able to focus on improving the operational performance and figuring out a coherent strategic direction.

    Michael Milken moderating the panel on Investing African Prosperity - Los Angeles, 1 May 2013
    Michael Milken who was famous for financing leveraged buyout deals

    Taking advantage of a conglomerate discount

    So our spiv financier could borrow money, buy the company at a discount. Sell off parts to pay off the loan and be left with more money than they initially had to borrow. Many of the constituent companies couldn’t be sold quickly as a going concern. Instead they were shut, machines sold for scrap and their factory land sold for redevelopment.

    Asian conglomerates

    Asian business people, especially those running Hong Kong and Chinese companies don’t view conglomerates in quite the same way.

    Li Ka Shing 李嘉诚
    Li Ka shing

    The Li family manage two publicly listed companies in Hong Kong. They came out of the merger of Cheung Kong Holdings and Hutchison Whampoa.

    Cheung Kong

    Cheung Kong Industries was formed in the 1950s as a plastic flower manufacturer during the post-war industrialisation of Hong Kong. It evolved into a property investment company after the 1967 riots and Cheung Kong Holdings was established in 1971. Over the next decades it became one of Hong Kong’s largest developers and land owners.

    In 2015, the group went under a reorganisation, the groups property assets were spun off into what is now CK Asset Holdings.

    Hutchison Whampoa

    Hutchison Whampoa was bought in 1979. HSBC had a strategic holding in the company and sold that on to Cheung Kong. They also provided Cheung Kong with the loan to make the purchase. In 2015, Cheung Kong bought the parts of Hutchison Whampoa that it didn’t already own. It eventually became CK Hutchison Holdings, incorporating all the non-property aspects of the Cheung Kong – Hutchison Whampoa combine.

    In addition, the Li family have some of the shares in businesses that they own held in the Li Ka shing Foundation (LKSF).

    CK Hutchison and CK Asset Holdings

    CK Hutchison Holdings and CK Asset Holdings both trade at a conglomerate discount. However, the Li family has a controlling share in them. This probably explains why they haven’t come under attack by an activist shareholder from within China or abroad.

    In his article for Apple Daily Yeung Wai-hong explains how the Li family uses the concept of conglomerate discount to their advantage.

    The CK Hutchison Holdings and CK Asset Holdings creation allowed shareholders to see clearly delineated businesses. One focused on property, the other one on non-property assets in 2015.

    CK Asset Holdings started to blur the lines buying into businesses that more sensibly fit into CK Hutchison Holdings – aircraft leasing, pubs and utilities. Creating conditions for a conglomerate discount that is disadvantageous to non-family shareholders. The bigger business has a larger turnover. Even if the profit margin is lower, management still have an excuse to raise their salary and benefits.

    CK Asset Holdings has a large amount of cash on hand indicating a lack of investment opportunities. Recently CK Asset Holdings bought shares in utilities from LKSF in exchange for shares in CK Asset Holdings.

    I’ll let Yeung Wai-hong explain the next bit

    …CK Asset promised to buy back shares equivalent to the amount of HK$17 billion and cancel them. Whether the equity will be diluted is up to the minority shareholders. If they do not accept buyback, their equity will be diluted; if they do, then it won’t. The buyback price is about 10% more than the average share price of CK Asset, so the minority shareholders do have a chance to cash in at a “high price.” However, the buyback price of HK$51 per share is only 53% of the net asset value after deducting the debt. So accepting the buyback is like allowing Li’s family to grab a bargain at half price.

    Conglomerate discount by Yeung Wai-hong, Apple Daily Hong Kong (March 29, 2021)

    If that happened outside Hong Kong there would be shareholder class action suits. The theory goes that these trades slowly put the squeeze on minority shareholders at a discount. Transferring value to the Li family. Eventually allowing for a gradual privatisation of the business at the expense of retail shareholders.

    Once this has been done the value of the assets at their full price can be realised. More finance related content here.

    More information

    ‘Conglomerate discount’ | Yeung Wai-hong ｜ Apple Daily 

    Britannica, T. Editors of Encyclopaedia. “Conglomerate.” Encyclopedia Britannica, September 26, 2007.

  • New Zealand + more news

    New Zealand

    An end to cigarettes? New Zealand aims to create smoke-free generation | New Zealand | The Guardian  – banning tobacco sales to people born after 2004, will drive illegal sales. New Zealand could quite easily have a prohibition type situation on his hands with rampant tobacco smuggling and organised crime. New Zealand has been a leader in tobacco legislation but replication of this in other countries could be challenged in courts on grounds of discrimination 

    Business

    The vanishing billionaire: how Jack Ma fell foul of Xi Jinping | Financial Times – the Yahoo! and Softbank Alipay ownership piece should be read by anyone looking to invest in Chinese stocks. Bilking the western investors was seen as a mark of loyalty by the Chinese government

    China

    Invisible China: How the Urban-Rural Divide Threatens China’s Rise – ChinaTalk – Xi Jinping just like two days ago was bragging about all these gangs that he’s been able to crack down on it. But the fact that he’s able to say he cracked down on [3,600 “mafia like groups] means that there were a whole lot more than [3,600 ganges- to crack down on in the first place. In the past few years, a few of the potential faults that you write about if China isn’t able to increase its workforce and find decent jobs for the common folk who haven’t made it to the cities yet is crime and social unrest. What are your thoughts about criminal enterprise in China and how it feeds into the themes that you talk about in your book? In the 1980s in Mexico, there was no crime. It wasn’t the Mexico that we know today. The Mexican government talked about what a safe place it was as they were growing very fast. Of course, everybody had a job. Everybody was employed. And that’s China today. China’s not a dangerous place, but Mexico wasn’t a dangerous place in the 1980s. What happened in Mexico, of course, is China happened, right? Wages in Mexico went up, as everybody got employed and the factories in Mexico decided to move. The maquiladoras moved to China. They moved back to the United States. They moved to elsewhere in the world and suddenly, within a couple years, 10 million people lost their jobs and that was 20% of the Mexican labor force – such a great interview

    Consumer behaviour

    Covid-19 and the rise in news misinformation – Press Gazette – “Our analysis of traffic to the top 100 global English-language news sites reveals that while news consumption soared overall in 2020, untrustworthy news sites saw bigger surges in readership” – Hat tip to Alan Morrison

    Finance

    How Dublin quietly became dumping ground for some of Europe’s riskiest corporate loans | Irish Times – shadow banking special purpose vehicles moved from Holland to Ireland

    Ideas

    Books that suck you in and books that spin you out – Austin Kleon 

    Systems Thinking in Seven (7) Images 

    Luxury

    Louis Vuitton joins China’s JD.com amid online luxury battle | Vogue Business – interesting move, is Tmall losing its grip?

    How Arnette Is Leading the Movement to Bio-Friendly Eyewear – bioplastics

    Gucci “Aria” Show Reveals Co-branded Balenciaga Pieces – SLN Official – this all looks like the the kind of shanzhai items I would have seen back when I first visited Shenzhen 15 years ago

    Marketing

    Browse our library of ebooks, webinars and videos – handy collection of resources by Meltwater

    Retailing

    What brands should know about Zhihu | Vogue Business – Initially invite-only, Zhihu has grown into an online content community of 75.7 million average monthly active users, who ask and answer questions and have access to in-depth articles, columns, videos and live-streaming sessions, often produced by the platform’s 43.1 million content creators… It makes most of its revenues through online advertising, but also offers a membership programme and online education to users, as well as content-commerce solutions to brands

    How the pandemic helped Walmart battle Amazon Marketplace for sellers | Reuters 

    The a16z Marketplace 100: 2021 

    Security

    Future Trends: Far-Right Terrorism in the UK – A Major Threat? | Global Risk Insights – there are also reasons to think that far-right terrorism may not develop into the major threat. Large ideological schisms exist within the far-right milieu (such as disagreements over anti-Semitism, capitalism, and violent vs democratic action) that keep far-right activity fractured. Far-right groups also tend to disintegrate due to infighting at a higher rate than Islamist groups do. Additionally, law enforcement may find far-right groups easier to infiltrate and monitor, as there would not be any linguistic or cultural barriers to surmount

    The $1 billion Russian cyber company that the US says hacks for Moscow | MIT Technology Review – One area that’s stood out is the firm’s work on SS7, a technology that’s critical to global telephone networks. In a public demonstration for Forbes, Positive showed how it can bypass encryption by exploiting weaknesses in SS7. Privately, the US has concluded that Positive did not just discover and publicize flaws in the system, but also developed offensive hacking capabilities to exploit security holes that were then used by Russian intelligence in cyber campaigns. 

    Much of what Positive does for the Russian government’s hacking operations is similar to what American security contractors do for United States agencies. But there are major differences. One former American intelligence official, who requested anonymity because they are not authorized to discuss classified material, described the relationship between companies like Positive and their Russian intelligence counterparts as “complex” and even “abusive.” The pay is relatively low, the demands are one-sided, the power dynamic is skewed, and the implicit threat for non-cooperation can loom large

    US Senator Who Served as Ambassador to Japan Lauds Closer Ties but Issues Warning | Voice of America – English – American concern about technology transfers extends beyond its relationship with Japan. “When the U.S. shares its cutting-edge technology with allies, it runs the risk that some of what is shared ends up in the hands of adversaries,” she said. For his part, Hagerty says that compared with four years ago, when he first took up the post as U.S. ambassador to Japan, the strategic challenge facing America “continues to get more serious, particularly with respect to China.”

    Technology

    Designed by Apple in California, Not Assembled in China | Above Avalon – Apple’s brand is less dependent on where its assembled

    Logic Chip Teardown From Early 1990s IBM ES/9000 Mainframe | Hackaday – The 1980s and early 1990s were a bit of an odd time for semiconductor technology, with the various transistor technologies that had been used over the decades slowly making way for CMOS technology. The 1991-vintage IBM ES/9000 mainframe was one of the last systems to be built around bipolar transistor technology, with [Ken Shirriff] tearing into one of the processor modules (TCM) that made up one of these mainframes – I remember when I was at college that bipolar / CMOS hybrid chips were touted to provide a radically faster computer chip

    2102.12627] How to represent part-whole hierarchies in a neural network – This paper does not describe a working system. Instead, it presents a single idea about representation which allows advances made by several different groups to be combined into an imaginary system called GLOM. The advances include transformers, neural fields, contrastive representation learning, distillation and capsules. GLOM answers the question: How can a neural network with a fixed architecture parse an image into a part-whole hierarchy which has a different structure for each image? The idea is simply to use islands of identical vectors to represent the nodes in the parse tree. If GLOM can be made to work, it should significantly improve the interpretability of the representations produced by transformer-like systems when applied to vision or language

  • Japanese insights & things that made my day this week

    Japanese insights

    Creative Culture ran a roundtable that provided with Japanese insights across brands and consumers. Well worth a watch.

    Key outtakes

    Kawaii or cute occurs in areas that you wouldn’t expect it. From Hello Kitty airlines and maternity wards to Miffy being used to sell mortgage services.

    Japanese newsprint
    Miffy selling mortgage service on a Japanese print newspaper advertisement

    Imagine 2060, more than 40% of Japan’s population will be 65 and older. This changes what market segments look like; no point chasing the latest generation. It will change what marketing will look like and what products will be sold. It would be an exciting time for product designers, creatives and strategists working with local clients who are willing to embrace the opportunity.

    Couple
    Couple by Norimutsu Nogami

    Newsprint and television are still popular media in Japan (and more popular than marketers are willing to admit outside Japan). These media still have a strong influence on consumers and are represented more strongly in the media mix by Japanese companies. In terms of Japanese insights for brand marketers this means that brand building should be less of a challenge from a media investment point of view than it would be in in some western markets or China.

    Japanese Television
    Japanese television by buck82

    Consumers shop daily or every other day. This is because they don’t have enough space to keep their groceries. So there are convenience stories in every neighbourhood. Retailers want to keep minimum inventory, so they receive frequent, small deliveries almost daily. Since there is a rapid turnover this in turn allows innovation around product innovation. Special edition Kit-Kats are the example most familiar to consumers. But you can see different products in the convenience store at different times of the day.

    Family Mart Convenience Store, Harajuku Tokyo, Japan
    Family Mart Convenience Store, Harajuku, Tokyo by MD111

    More Japanese insights here.

    China

    Moving from Japanese insights to Chinese strategy, the Center for Strategic & International Studies discusses what is needed for the west to have a better China strategy.

    Technology

    The Computer History Museum in Silicon Valley, took the opportunity to interview Mark Markkula. Markkula was an engineer and product marketer involved at Fairchild and Intel during the early days. He put in seed capital into Apple and sat on the board until 1997.

    If you watch nothing else on this post, watch this discussion between Stephen King and Jeremy Bullmore at J Walter Thompson. Bullmore ended up as chairman of J Walter Thompson, eventually retiring in 1987. King established the first account planning department in the advertising industry at J Walter Thompson in 1968.

    May of the problems outlined are similar to problems today.

  • Metabolist architecture + more things

    Metabolist architecture

    kisho kurokawa’s metabolist ‘capsule house K’ from the 1970s to be preserved in japan – the metabolist group, formed by architects, designers and critics, imagined a world of flexible cities where buildings, like people, were transient and ever changing. designed and built between 1971 and 1973, ‘capsule house K’ exemplifies the ideas of metabolism, recyclability and exchangeability – What separates the Japanese metabolist architecture and design movement from the western prefab manufacturing is that it was genuinely modular. A single capsule like this house could exist on its own, or could be part of a tower structure. The focus on flexible cities at the centre of metabolist design and the idea of recyclability. The western prefab approach is all about bringing product line techniques to create quick builds.

    Consumer behaviour

    Taking Stock With Teens – Spring 2021 Infographic 

    Marketing

    Did pharma overshoot digital sales rep calls? Study charts decline in effectiveness | FiercePharma – I think that there are interesting implications for a lot of digital marketing activities, like LinkedIn and email marketing

    Media

    The Wall Street Journal’s Internal Audit – The New York Times – none of the editors understand digital and that the paper is unlikely to have any success reaching the younger readers they desperately need without managing to write something about either race or gender. More media related content here.

    Security

    A secretive Home Office unit has hoarded data on millions of people | WIRED UK – more than 30 data providers are listed in the documents. Only two of these, fraud prevention company GB Group and data analytics firm, Dun & Bradstreet, were not redacted. GB Group acknowledged it provided data to the unit but declined to provide any further details citing “confidentiality obligations”. Dun & Bradstreet says it is against its policy to comment on its work with clients. I’d be surprised if they weren’t

    Technology

    Microsoft accelerates industry cloud strategy for healthcare with the acquisition of Nuance – Stories – I wonder what this means for Apple and Google voice recognition

    Wireless

    A booming industry based entirely on missed calls helped bring India online — and vanished overnight – Rest of World – Kumar’s friends and family members began ringing each other but hanging up before being charged for a call; the resulting missed-call alerts functioned as a kind of code between them. “It was decided in advance,” Kumar says. “We would say, if I’m coming to pick you up, I’ll give you a missed call, and you come out of your house.” 

    Leaving missed calls in this way — effectively using a mobile phone as a kind of latter-day pager — was a consumer hack that, in the 2000s, before India’s cheap smartphone and data revolution, grew more popular than texting. The missed call emerged in India as a critical means of communication for those who counted every rupee spent on recharge credit. But the practice soon spread, became trendy, and, even as call rates plunged in the 2000s to among the lowest in the world, evolved into a general tool of convenience: a missed call could mean “I miss you,” “Call me back,” or “I’m here.” The fact that the missed call demanded only basic numeric literacy made them accessible to the third of India’s population that was illiterate. In 2008, one study estimated that more than half of Indian phone users were in the habit of calling people with the expectation that they wouldn’t pick up – you had similar consumer patterns around the world, but Indians seem to have taken it to a new level