My interest in business or commercial activity first started when a work friend of my Mum visited our family. She brought a book on commerce which is what business studies would have been called decades earlier. I read the book and that piqued my interest.
At the end of your third year in secondary school you are allowed to pick optional classes that you will take exams in. this is supposed to be something that you’re free to chose.
I was interested in business studies (partly because my friend Joe was doing it). But the school decided that they wanted me to do physics and chemistry instead and they did the same for my advanced level exams because I had done well in the normal level ones. School had a lot to answer for, but fortunately I managed to get back on track with college.
Eventually I finally managed to do pass a foundational course at night school whilst working in industry. I used that to then help me go and study for a degree in marketing.
I work in advertising now. And had previously worked in petrochemicals, plastics and optical fibre manfacture. All of which revolve around business. That’s why you find a business section here on my blog.
Business tends to cover a wide range of sectors that catch my eye over time. Business usually covers sectors that I don’t write about that much, but that have an outside impact on wider economics. So real estate would have been on my radar during the 2008 recession.
Technonationalism as a term has started to spring up in Chinese policy discussions regarding technology trade with the US and China.
Technonationalism origins
Technonationalism is a term used by economist Robert Reich in 1987 to describe the relationship between technology and national security. Reich used the term in an article that he wrote for The Atlantic. It originally referred to the intervention of the Reagan administration in the United States to prevent the acquisition of Fairchild Semiconductor by Japan’s Fujitsu. Reich felt that the Reagan administration mis-understood the the technology problems faced by the US and blocking the Fujitsu-Fairchild deal was the wrong thing to do.
Elkor Labs photo of Fairchild Semiconductor exhibition stand.
The China effect
In English language usage, it started to be mentioned in publications as far back as 1969 and seems to have had two distinct peaks. The first was from the Brezhnev-era Soviet Union through to 1990. The second peak coincides with China’s rise.
From a Chinese perspective, strategic conflicts between major powers have revitalised the concept in the international political arena. Of course, this ignores China’s own actions and their perceptions by other countries:
Chinese government policies to promote economic independence and induce strategic dependence of other states across all infrastructure technologies – or as the FT calls it ‘Fortress China‘
Today, the competition between China and western democracies is focused on critical materials like pharmaceuticals and a range of strategically important advanced technologies.
These sectors include:
Electric vehicles (or as they are called in China new energy vehicles)
Drones, virtual reality,
Various type of machine learning ‘artificial intelligence’
Big data and data mining
Robotics and automation
5G networks
The Internet of Things (IoT),
Synthetic biology
This conflict is considered more severe than the US – Japanese semiconductor trade friction of the 1980s. But Japan and the US were largely aligned from a political, defence and economic perspectives during this time.
The technology related to disputed sectors are seen as key to the next generation of defense systems, industrial capabilities and information power China and western democracies.
Neo-liberalism & technonationalism
This implies that economics is an extension of defence rather than completely separate, as implied by the western neo-liberal laissez-faire approach to globalisation. This places company leadership dead set against the wider interest of their own western countries. During the cold war with the Soviet bloc western companies were much better aligned with their country’s interests.
Palmer Luckey’s Anduril represents a notable exception in Silicon Valley and its attitude is remarkably different to the likes of Apple or Microsoft.
Post-war Asian miracle model
While technonationalism as a term was given voice in the mid-1980s, one could consider the directed economy efforts by the likes of MITI in Japan and its counterparts in Taiwan and South Korea as being technonationalist in nature.
From this perspective, technonationalism played a crucial role in post-World War II economic and industrial policies, fostering domestic industries, promoting scientific and technological innovation. These polices propelled Japan to become a global technological power. Korea took a similar tack with Park Chung Hee’s compact with the chaebols and the Taiwan government was crucial in the roots of Taiwan’s dominance in semiconductors.
Back to the present
The current increase in technonationalism by China and western democracies means that international trade in many fields will continue to change due to national security concerns evolve. This is often masked in language such as de-risking, de-coupling and de-globalisation.
The racket sport padel seems to have got the zeitgeist, if not the player numbers yet. We haven’t really seen a surge in sports fads since the 1980s. During that time skateboarding rose from a peak in the late 1970s, to a more stable underground sport that we have today. The closure of a squash racquet factory in Cambridge, saw the sport globalise manufacture and playing. In a few short years rackets went from gut strings and ash wood frames to synthetic strings and carbon fibre composite rackets. It was as much a symbol of the striving business man as the Filofax or the golf bag. Interest was attracted by a large amount of courts and racket technology that greatly improved the game.
Squash had its origins in the late 19th century and took the best part of a century to reach its acme in the cultural zeitgeist. Skateboarding started in the late 1940s and took a mere 30 years to breakout. Padel falls somewhere between the two. Padel was invented in 1969. But it took COVID-19 to drive its popularity in Europe and North America.
There is a new world professional competition circuit for 2024. And it has attracted the interest of court developers looking to cater to what they believe is latent consumer demand.
Finally, you can get three padel courts in the space for one tennis court. More on the padel gold rush from the FT.
The challenge is if padel is just a fad, or has it longevity? Skateboarding is popular, but many councils didn’t see the benefit of supporting skate parks built in the 1970s around the country. Squash still has its fans but doesn’t have the same popularity that it enjoyed in the 1980s.
What’s it like being a Disney adult? – The Face – this is much more common in Hong Kong, but then people had annual passes to go there. I found it interesting that The Face othered it as a sub-culture
Vittles Reviews: There Is Always Another Province – Province-chasing isn’t just a Western phenomenon; China is still so vast that when the barbecued food of Xinjiang, one of China’s border provinces, showed up in a former sausage shop on Walworth Road at Lao Dao, it didn’t need to open to the general public for months, choosing only to take bookings via Chinese social media. The paradox is that the success of regional Chinese restaurants has created a Western audience which wants more, but that same success has allowed these restaurants to bypass those customers altogether
Culture
Television: one of the most audacious pranks in history was hidden in a hit TV show for years. – Watch enough episodes of Melrose Place and you’ll notice other very odd props and set design all over the show. A pool float in the shape of a sperm about to fertilize an egg. A golf trophy that appears to have testicles. Furniture designed to look like an endangered spotted owl. It turns out all of these objects, and more than 100 others, were designed by an artist collective called the GALA Committee. For three years, as the denizens of the Melrose Place apartment complex loved, lost, and betrayed one another, the GALA Committee smuggled subversive leftist art onto the set, experimenting with the relationship between art, artist, and spectator. The collective hid its work in plain sight and operated in secrecy. Outside of a select few insiders, no one—including Aaron Spelling, Melrose’s legendary executive producer—knew what it was doing. The project was called In the Name of the Place. It ended in 1997. Or, perhaps, since the episodes are streamable, it never ended
Rode acquire Mackie | Sound On Sound – this is big for podcasters, but also for artists that record in their own studios. Mackie mixers have powered the home grown set-ups of artists like The Prodigy, The Crystal Method, Brian Eno, Daft Punk and Orbital.
Health
China e-cigarette titan behind ‘Elf Bar’ floods the US with illegal vapes | Reuters – In the United States, the firm simply ignored regulations on new products and capitalized on poor enforcement. It has flooded the U.S. market with flavored vapes that have been among the best-selling U.S. brands, including Elf Bar, EBDesign and Lost Mary. In the United Kingdom, by contrast, Zhang has complied with regulations requiring lower nicotine levels and government registration while building an unmatched distribution network — and driving a surge in youth vaping
Hong Kong’s first ‘patriots-only’ district council poll reflects political tale of two cities, as some eagerly rush to vote and others shy away | South China Morning Post – Hong Kong on election day splits into two camps, with one eager to vote out of civic duty and others giving polling stations wide berth over lack of political diversity. ‘I thought more people would come and vote because there has been more publicity,’ one elector says after discovering sleepy atmosphere at local polling station – the question is will Beijing take anything from this voter turn out? Does it signal suppressed but indignant separatists, or Hong Kongers who are more focused on prosperity and weekend Netflix? If they suspect the former then the security situation is likely to get more dire
Inside Louis Vuitton’s Hong Kong spectacle | Vogue Business – While Hong Kong is gradually recovering from the pandemic lockdowns, growth in Mainland China is slowing. According to HSBC estimates, luxury sales there are expected to grow 5 per cent in 2024, a sharp deceleration compared with 2023’s projected 18 per cent.
It took me a little while to write this post on Pebble. Pebble was a start-up that looked to build a more civil microblogging platform than Twitter. Unfortunately it closed on November 1, 2023.
It supported 280 character posts, replies and messages. The staff validated prominent users such as journalist accounts. The service had its own mascot rather like the famous Twitter fail whale; it was a snail called Herbert.
It was the little touches in the user interface that most impressed me when I first started using it, like the ‘radio button’ functionality that showed you what mode you were using the service in. In the screen shot above you can see how the profile icon on the left is filled out to show I was looking at my profile.
The Pebble community
The founders set out to build a community that more resembled early Twitter than the reactionary discussion dominated platform of today. Along the way they also looked in improve the Twitter user experience design. The product was launched as T2 and slowly built up a community. There are good reasons for slowly building a community.
As co-founder, Gabor Cselle put it
“Twitter, but back to the roots”
From T2 to Pebble: The Rise, Challenges, and Lessons of Building a Twitter Alternative by Gabor Cell on Medium.com
Years ago, I got to see George Oates talk about how the community around photography social network Flickr built up. The key was a slow build up of the right people to ensure a community was built with a set of norms that would morph into community rules and culture as the platform scaled larger.
Which begs the question is Pebble a platform at all, or a common state of mind that bonds the community together?
The Pebble community was surprisingly diverse from designers, fantasy authors and Silicon Valley insiders to Japanese cat enthusiasts and a few random netizens like myself. It was odd and eclectic like Twitter circa 2006 / 2007. In this respect it certainly met the brief of “Twitter, but back to the roots”.
This diversity was even more surprising that the platform had about 20,000 registered accounts in total. Media coverage of T2 had garnered an original waiting list of 33,000 interested people.
T2 is dead; long live Pebble
Originally the platform was called T2, a not so subtle allusion to the ambition of building a better Twitter microblogging service. One that isn’t full of reactionary content, or the erratic policies of owner Elon Musk.
T2 rebranded to Pebble. This was to provide a name that was more human-friendly than T2. The move to Pebble pleased investors, but didn’t help attract new consumers.
Criticisms
Pebble didn’t work for everyone, my friend Stuart claimed that he found it unusable with Microsoft Edge. Pebble didn’t have an app, which would have taken time to develop and so would APIs.
If Pebble had started licensing APIs to social listening platforms, this may have driven more brand interest in the platform over time and would have been a clear differentiator vis-a-vis Threads, Bluesky, TikTok and Instagram.
Scale
In the technology sector, scale is considered to be everything. But that’s the approach that left us with TikTok, Facebook and Twitter with all of their attendant problems. Yet despite the attendant problems of large technology platforms, trust and safety were not clear compelling differentiators for Pebble.
A second problem that the founders identified was that there wasn’t enough content coming in to make it a daily destination. Like Twitter and Threads before it, I found I had to ‘wind up’ to putting content on the platform on a daily basis.
My timing wasn’t great.
The End
The last post was by Serge Keller, who posted a video of Vera Lynn’s We’ll Meet Again.
“This is not the end, it is not even the beginning of the end, but it is perhaps the end of the beginning.”
Winston Churchill
Pebble didn’t completely die. As soon as news broke of the platform’s demise a few things happened. Participants started rallying around, sharing their details on other platforms and sharing invites for Bluesky and Mastodon.
Gabor set up a sub-Reddit for Pebble participants, which didn’t get too much take-up. But a Mastodon instance that he skinned in the Pebble UI and put up as a social experiment did manage to take off.
It provides an improvement on the user experiences I have seen on other Mastodon instances so far. A surprisingly large amount of the Pebble community kind of held together across Bluesky and Mastodon. This indicates to me that to those that know safety and trust might be more compelling than we currently believe. I find myself using the Pebble Mastodon instance more than Bluesky at the moment.
Over the past few years we’ve seen a plethora of watch registry platforms spring up. There have been a number of reasons for this happening:
European Union regulations
Business processes
Crime
European Union regulations
The European Commission Health and Digital Executive agency have been championing the idea of digital product passports across a range of sectors including textiles and various manufactured goods. This includes:
Electrical and electronic equipment
Batteries
Food waste
Textiles
Packaging and packaging waste
Even if a watch is mechanical in operation and doesn’t come with a sewn strap, it still comes with packaging. Digital product passports mean that watchmakers end up with a watch registry service almost by default for newly manufactured watches.
The EU digital product passport sits at the intersection of a number of EU related policies including the Ecosystem for Sustainable Products regulation and the Cyber Resilience act. The focus on sustainability is designed to facilitate a circular economy of manufactured, serviced and recycled materials. Having a product’s documentation follow it through its life helps prevent fraud and regulatory non-compliance in a similar way to animal passports as part of the common agricultural policy. It isn’t perfect but it makes criminal activities harder to do and easier to uncover. For such a system to work, it would need to resist the efforts of bad actors like Russia.
There are secondary benefits to the digital product passport including inserting friction in the global trade of products made outside of the EU for importation into the trading bloc, such as fast fashion items.
Luxury items, by their nature have less to worry about, but given their high value, at a future date analysing watch registry data may help understand and intercept money laundering schemes.
There have been existing watch registry players for instance The Watch Register which is a spin-off of the Art Loss Register.
Business processes
As well as using the digital product passport for regulatory purposes and a watch registry. Digital product passports allow product traceability to facilitate:
Manufacturing including quality control and quality assurance
Service and repair
Customer relationship management
Product recycling or remanufacture
Proof of authenticity throughout the life of the product, provided as a watch registry function
Crime
Non manufacturer related platforms have been very upfront about their concern to help combat watch thefts that seems to have surged. Between 2021 and 2022 luxury watch thefts in London surged over 40 percent. London as a global city has rapidly built a reputation for itself as a centre for watch thefts. It has been suffienctly out of control that a luxury auction house and secondary market dealers have been warning prospective and existing customers of the crime risk. The idea is that by having traceable ownership of timepieces in a watch registry, the stolen watches would be harder to fence and would likely be seized when submitted for service, repair or resale.
For secondary dealer watch related fraud has also been an issue with a high profile allegations against Anthony Farrer aka The Timepiece Gentleman (TPG).
The Watch Register
The Watch Register was founded in 2016. For a 20 percent fee, they will store the details of a stolen watch. Watch dealers then check inventory that they are about to receive against the their database. This is problematic for a number of reasons:
You can’t register your watch unless it’s been stolen.
Police are now reluctant to provide a crime number to watch thefts, which you need to register your watch.
There’s a 20 percent fee for registration
The watch, its box and papers may have all been stolen. Which might make having the watch number to hand all the more difficult.
Reviews on watch forums of the service have been mixed. Given the forthcoming regulations coming through The Watch Register is likely to be relegated only to older watches and its 20 percent commission fee looks expensive versus both manufacturer offerings and Digital Watch Vault.
Blockchain and Watch registry
Some of these services have adopted blockchain as their technology stack of choice. I am sceptical of blockchain as a technology in general due to its relatively slow transaction rate compared to relational databases and high speed payment networks operated by the likes of Visa, Mastercard and American Express.
Arianee digital passport
Arianee is a SaaS business and a governing body for a protocol. It offers digital passport and membership services that are used by luxury fashion brands, luxury retailers and beauty brands. Several watch brands have adopted Arianee’s digital passport offering. The product is white labelled and different brands might use different functions, but it is based on top of a block chain technology stack.
Audemars Piguet
Breitling
MB&F
Panerai
Roger Dubuis
Vacheron Constantin
Breitling was the first of the brands to launch its digital passport service in 2020, Panerai rolled their version out in October 2023. There isn’t cross-brand interoperability to make a registry of registries. They all seem to operate as ‘shards’ or instances.
Aura digital product passport
Aura is an LVMH led consortium for the deployment of blockchain based solutions focused not he luxury sector. Other luxury groups including Richemont and Prada Group are members. Much of the use has focused on luxury fashion brands like Loro Piana and Prada. Cartier is also involved and the service is pitched at luxury watch makers. Watchmakers involved include
Bulgari
Cartier
Chopard
H Moser
Hublot
Like Arianee there isn’t cross-brand interoperability for the watch registry function.
Digital Watch Vault
Digital Watch Vault is a platform that has been put together by individuals involved in the secondary market for watch. There is no charge to submit the details of your watch.
Digital Watch Vault is a new service. It has a number of high profile advocates as well as some detractors.
Omakase is a Japanese term that has become popular in Korea. Omakase as a phrase comes from the term ‘makaseru’ meaning to entrust. In a sushi restaurant omakase meant the customer turned over responsibility for choosing their menu to the sushi chef. The chef would choose the type of fish and the cut. They would assemble the sushi in front of the customer, tell them what it was and choose the next piece, based on what they think the customer should try next. It is likely to have developed sometime in the last two centuries when nigiri sushi became popular. This was sushi that could be quickly assembled in front of the customer – which is essential for the way omakase operates.
Omakase experience
The personalised nature of the experience and the choice of ingredients by the chef rather than the customer means that omakase is an expensive experience. The ingredients will be seasonal in nature and the chef will select the finest ingredients available.
A short trip across the Sea of Japan (or what the Koreans call the East Sea) is South Korea. And it was inevitable that this particular type of sushi experience would cross the waters as well, given that it has already made it the best sushi restaurants in the US and Europe.
Gangnam at night by laurabl
Expansion of Omakase
In Korea omakase took off some time before 2020. At first it was in upscale sushi restaurants. Then it extended itself into tempura in the Japanese restaurants of high end hotels in Seoul, you see this in some restaurants in Japan as well.
It started to spread throughout the country beyond Seoul and as it grew geographically within Korea, it was extended beyond Japanese cuisine.
Western dessert tasting menu as an omakase experience
Coffee tasting with your own barista. Coffee fuels Korean work life and is immensely popular.
Champagne tasting with a personalised experience from a sommelier.
It has been even extended to grilled pork belly – a stable dish of Korean neighbourhood restaurants. Rather than barbecuing it yourself, pieces are selected and grilled for you by a personal chef.
Why ‘Korean omakase’ happened?
In Korea you have a confluence of factors affecting young consumers.
Korea is known for its luxury consumption. On a per capita basis, Koreans spend more on luxury personal goods than any other country. Harrods has been surpassed as the number one retailer in luxury goods by the Shinsegae department store branch in Gangnam-gu, Seoul, Korea with $2 billion dollars of sale in 2021.
Like young consumers in many developed markets, young Koreans have money in their pocket but are unlikely to be able to afford to buy their own home. Korea’s ultra-wealthy have a good deal of their wealth in buy to let property.
The Jeonse system of home rental exasperates the home ownership problem. A Jeonse tenancy begins with the initial security deposit of a single amount which is usually about 40% to as much as 80% of the current market value of the property. Unlike in most of Europe, the interest yield on the deposit will not be paid to the tenant, but the landlord can keep this as income. No additional monthly rent is paid. On expiry of the contract period, the original deposit will be refunded in full.
This leaves young (and not so young) Koreans heavily indebted and makes it hard to plan for the future.
Live for today, the future is lost anyway
So young Koreans spend on luxury consumption now, rather than save for a future that they believe is unaffordable. While Korean is a developed economy with successful industries, one in ten of young Koreans are unemployed. When they look at the generation of Koreans who built the country over from the post-war years into the developed economy it is today; 45% of these elderly live in poverty.
Omakase as social standing
Luxury consumption is used to reflect a higher social standing. Korea is known for a high degree of conformity, which creates big fashion winners. Once a trend picks up, it goes everywhere, but then also has a finite life as brands like The North Face have found to its cost in the past as consumers move with the crowd.
But Korea is also a Confucian society which means that social standing matters, and this is where the luxury consumption comes in. The quest has moved into online channels as well, with these channels showing to your peers your social standing.
Jeong
The social platforms act as a pressure point in modern Korean life. Because of social, luxury experiences like omakase become as important as having luxury goods.
In Korea, the power of social is amplified by jeong (정) – can be considered to be a sense of social responsibility. Jeong is a positive force for conformity and community in a collectivist society. Historically, jeong is built through shared experiences, such as eating together and a sense of community bond is formed.
Aspects of jeong include
Scheduling quality time with loved ones.
Create meaningful shared experiences.
Expand and engage with your community.
Modern urban and digital life has disrupted Korean society which has meant that values like jeong manifest themselves in new ways.
Mukbang aside
The principles of jeong is where mukbang videos originally came from. Mukbang started as streaming videos where the host would share a virtual meal with the viewers and interact with them. Korean meals are designed to be shared, yet a third of Koreans live in single person households. Mukbang provided the lonely with shared experiences that had a degree of meaning in their lives – creating a kind of virtual jeong between the host and the audience. Now they are genre of video content that’s carefully edited and removed from the original social context that they came from.
Getting back to jeong, think about your Instagram feed for a moment, think about how you might feel if you have had a mediocre day and your feed is filled with people you know living their best lives. Now dial that up to 11.
Sharing content is engaging with your wider community and growing your community and sharing experiences with them. There is a corresponding pressure to share experiences back within your feeds. This has driven a demand for luxury products and experiences including omakase.
Omakase is a rational economic response. There are only so many times that you can share a new bag or watch costing thousands of pounds. But you can share omakase each time you go, with the price being in the hundreds of pounds instead.
So where does the money come from?
Omakase experiences aren’t an everyday thing for young Koreans; they would think its perfectly fine most days to eat a lunch bargain meal from a convenience store and then do an omakase experience every so often that they can document it on social media.
Korean households have the highest amount of debt in the world, and over 21% of young Koreans have personal debt that at least three times their salary. A decade earlier, the rate was 8.2%.
So what?
Korea today is a cultural powerhouse. Trends that start here go worldwide. Korea is involved in all aspects of global culture:
Cinema.
Television series.
Beauty.
Fashion.
FMCG products.
Food.
Korea’s role as a global trendsetter has not gone unnoticed, Christian Dior opened its flagship store in Seoul and held its collection debut in Korea over China or France.
Luxury businesses already realise that consumers want status experiences as well as status goods. LVMH has been actively exploring the hotel and restaurant business, as has Kering. But these businesses have lower margins than their existing businesses. The way to increase these margins would be to address less customers and charge even more.
Luxury is being redefined into highly personalised experiences by consumers and it makes commercial sense for luxury businesses to meet their needs.
While luxury groups are looking at cutting edge technology like generative AI, NFTs and metaverse experiences, the future of luxury might be more human, as well as more technology.
