This jawn

MARKETS

  • U.S. markets: Stocks took a breather yesterday after President Trump called U.S.-China trade tensions "a little squabble" and reassured Wall Street he's working on a deal.
  • Energy: More drama in the Middle East pushed crude prices higher. A day after two Saudi tankers were sabotaged, the country said drones attacked two pump stations.

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MEDIA

Hulu the Dogs Out?

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Disney (+1.43%) has agreed to buy Comcast's one-third stake in Hulu and will take full operational control of the streamer immediately. Yippie yi yo.

The details: Comcast (+1.49%) will be able to sell its Hulu stake to Disney less immediately--as early as January 2024. Disney pinky promised Hulu's equity value at that time will be at least $27.5 billion, nearly double the $15 billion valuation Hulu got last month.

An impressive number...but consider that Netflix is worth about 10x Hulu.

It's still a defining moment for Hulu

Which could arguably claim the most complicated 23andMe report of any modern media property.

  • NBC and Fox founded Hulu over a decade ago as a way for the DVR-averse to watch last night's TV.
    Then Disney acquired a stake...and the streaming service became the only child of three Hulucopter parents.
  • Disney, NBC, and Fox struggled to agree on a direction to take Hulu, while Netflix was busy gaining market share and investor praise.

But nevertheless, Hulu persisted

It's not 148.9-million-strong Netflix, but Hulu had 28 million subscribers at the end of April, up 12% from the end of 2018. And though Hulu is slated to lose over $1.5 billion this year, Disney CEO Bob Iger said he's got plans for it to a) reach 40 million subs and b) turn a profit by around 2024.

Those plans fit squarely with Disney's big streaming dreams. Remember, it's launching its direct-to-consumer service Disney+ in November.

  • How it shakes out: Hulu will center on adult-focused content (get your mind out of the gutter...we're talking Brooklyn Nine-Nine and The Handmaid's Tale). Disney+ will focus on families and kids.

Bottom line: Disney's character arc is reaching a crescendo, and Bob Iger's campaigning for an Emmy in the "Biggest Threat to Netflix" category. As for Comcast-owned NBCUniversal? It's also laying the groundwork for its own unnamed streaming service.

SOCIAL MEDIA

Nextdoor Is a Diamond in Silicon Valley

Nextdoor, an app that calls itself "the world's largest social network for the neighborhood," announced yesterday it raised $123 million at a $2.1 billion valuation. The company will use the funding to try and muscle into European communities.

  • It ain't 2012 anymore: Venture-backed social media startups have been left out to dry, with funding hitting a 13-year low last year, according to PitchBook Data.
  • Makes sense...after you wake up and scroll through Twitter, Snapchat, Facebook, and Instagram, it's just about bedtime.

But Nextdoor has found success. Leading the charge is brand new CEO Sarah Friar, who came over last fall from chief financial officer-ing Square. "Sarah Friar may be one of the best CEOs that the Valley's ever seen," Benchmark's Bill Gurley told the WSJ (probably doesn't surprise you his firm's a Nextdoor investor).

Nextdoor also has its critics, who say the platform doesn't do enough to prevent its crime and safety section from being used for racial profiling. Convincing the public the platform can be used to build community, rather than divide people, is now up to Friar.

BEVERAGE

Soda, Pop, Coke...It Costs More in Philly

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Yesterday, the Journal of the American Medical Association (JAMA) published the most comprehensive study to date on Philadelphia's soda tax jawn. TL;DR: When soda costs more, people...buy less soda.

  • The tax, which added 1.5 cents per ounce and began in January 2017, correlated with a 1.3-billion ounce decrease in sweetened beverages sold--a 38% drop.

The tax is popular among public health advocates, who say it's an effective tool to combat obesity and diabetes. And cities are also using it for extra revenue. According to Healthy Food America, seven U.S. cities are raising over $130 million annually with various sugary/sweetened drink taxes.

But the American Beverage Association says the taxes impose unfair burdens on consumers and small businesses. And the researchers in the JAMA study noted they couldn't yet demonstrate a connection with improved health, just a reduction in sales.

The more you know: The study was funded by Bloomberg Philanthropies, the foundation of carbonation-phobic former NYC Mayor Michael Bloomberg. The billionaire has devoted millions to lobbying for soda taxes.

CYBERSECURITY

Don't Hit "Remind Me Tomorrow" for WhatsApp

WhatsApp is urging its 1.5 billion users to update its service after it discovered a vulnerability that let hackers weasel their way into users' smartphones.

How it works: The hackers injected commercial Israeli spyware onto phones simply by calling them through WhatsApp. They could then use that malicious code to surveil both iPhone and Android devices.

It's not clear how many WhatsApp users were targeted (and most expect it was primarily activists and political dissidents). But once installed, the spyware could turn on phone mics and cameras, scan messages and emails, and collect location data.

About the spyware...it was allegedly developed by Israel's secretive NSO Group. As the Brew's emerging tech whiz Ryan Duffy puts it, "NSO's spyware is crazy [redacted] good."

  • NSO denied involvement in selecting/targeting victims...but didn't deny that its tech was used to exploit vulnerabilities in WhatsApp.
  • Experts think NSO's spyware has been used by up to 45 countries in persecution efforts of dissidents, journalists, and others.

Optional homework: The FT will get you in-the-know about NSO (there might be a paywall).

TRAVEL

Name the Hotel

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This is the new TWA Hotel at New York's JFK Airport. When the $265 million hotel opens today, it'll conjure memories of the golden age of jet travel--when pilots strutted with the confidence of Leonardo DiCaprio in Catch Me If You Can, and you didn't have to worry about your seat-back screen being broken because there were no seat-back screens.

The history:

  • The TWA Hotel is located in the Trans World Airlines Flight Center, which first opened in 1962.
  • Designed by Eero Saarinen, the terminal is considered a masterpiece of "Googie" architecture...but it closed in 2001 following TWA's demise.

Now it's back, and 1962 is looking pretty good in technicolor. Developer Tyler Morse has decked out the place with 512 rooms, eight bars and six restaurants, and an infinity pool with views of a runway.

And for those of you who consider 100% occupancy a success, why are you setting the bar so low? "My objective is to sell every room every day twice a day...our plan is to run 200% occupancy," Morse told the WSJ.

WHAT ELSE IS BREWING

  • Nissan's life after Carlos Ghosn looks...bleak. The company reported a drop in profit as it fends off a merger with French partner Renault.
  • Bayer got rocked again by the fallout from its Roundup legal troubles. Shares have fallen over 45% in a year.
  • Walmart (+0.39%) won't let Amazon enjoy its lead if it's the last thing it does. The retailer announced its own plans for next-day delivery.
  • Foxconn's bottom line took a hit last quarter after its biggest customer, Apple, suffered a slowdown in iPhone sales growth.

BREAKROOM

Guess the Logo
This is a two-parter:

  1. Which retailer, whose origins date back to the 19th century, recently unveiled this new logo?
  2. Some think this logo looks eerily similar to another company's logo. Which one?

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Breakroom Answers


Guess the Logo
1. Sears 2. Airbnb

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May 15, 2019
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