Uber goes dark

MARKETS

• U.S. markets: Not pretty thanks to a flare-up in U.S.-China trade talks. The Dow registered its biggest drop since early January.
• Europe: The EU was also Googling “panic rooms” over trade and a slowdown in the auto industry, trimming its forecast for eurozone economic growth this year and next.

UBER IPO

A Day Uber Goes Dark

Trying to remember what 2005 was like? You might have a chance today. Drivers for ride-hailing companies Uber, Lyft, and others are planning to strike in at least eight cities across the country. The rallying cry: “Apps Off!”

The timing is obvious. Uber is just two days away from going public in what will probably be the biggest tech IPO since Facebook, valuing Uber as high as $91 billion. As execs and early investors cash out and go yacht shopping, drivers feel like they’ve been shortchanged.

The fighting words from the New York Taxi Workers Alliance:

• “Wall Street investors are telling Uber and Lyft to cut down on driver income, stop incentives, and go faster to Driverless Cars.”
• With the IPO, “Uber's corporate owners are set to make billions, all while drivers are left in poverty and to go bankrupt.”

The specific demands: Greater job security, a livable wage, and a guarantee that 80-85% of the fare goes to the driver.

Uber’s IPO is a landmark moment for the gig economy

Out of the ashes of the financial crisis, a new structure of “work” emerged—one that emphasized flexible, short-term contracts instead of full-time employment.

And the average Uber driver symbolizes both the promises and the pitfalls of that gig economy.

• She’s able to drive whenever she wants, but she’s concerned about the stability of her job and the large cut Uber takes from her fare.
• And the future is no comfort, either. Uber and Lyft know that replacing human drivers with self-driving vehicles is their only path to profitability (Uber lost $1.8 billion last year).

Bottom line: Many questions cloud Uber’s mega-IPO, but at the top of the list is its rocky relationship with the drivers it can’t currently live without. That’ll be on full display today.

RIDE-HAILING

We Didn't Forget About You, Lyft

Lyft (-1.58% after hours) reported its first quarterly financials as a public company yesterday. It beat revenue estimates, bringing in $776 million, a 95% increase from 2018.

You never forget your first, because it’s expensive. Lyft posted a ginormous loss of $1.1 billion, though $859 million of that was stock-based compensation related to the IPO. It still lost an adjusted $212 million, which came in under both estimates and last year’s $228 million. Yes, profitability seems far away.

But in a twist…Alphabet’s autonomous driving unit, Waymo, announced a partnership with Lyft yesterday. Sometime in the next few months, Lyft users in Metro Phoenix will be able to select Waymo as an option. It’s a crucial pilot program for Lyft, which as we mentioned is banking on a future without pesky drivers to pay.

The context: Lyft went public March 29 and had a bruising first month—shares have fallen 18% from its IPO price. But with Uber going public on Friday, Lyft’s hoping to pass on the “ugly duckling of IPO season” distinction to its archnemesis.

TECH

That’s One Way to Kick Off a Google Event

At the company’s I/O developer conference yesterday, Google CEO Sundar Pichai took the stage to music by an AI-based DJ...but only after learning Tiësto uses an iPhone.

What Pichai preached: new features and a reinvigorated focus on privacy.
On AI…

Last year at I/O, Google launched Duplex, the customer service-focused AI bot that could handle more phone calls than your newly single friend. This year, Duplex is heading to the web for rental car reservations, movie tickets, etc.

Google tried on ethics. Pichai said it’s working on new methods to erase bias in AI to make sure it’s “fair and works for everyone.” Plus, Google touted its “AI for Social Good” efforts.

On privacy…

Just a couple months too late for Robert Kraft, Google announced plans to add “Incognito” modes to Google Maps and search to keep activity from being linked to your Google account. Plus, it unveiled plans to add a one-touch method to make it easier/faster to change privacy options in its major apps.

+ Google revealed a lot more: a cheaper Pixel phone, Google Assistant upgrades, and something called a Google Nest Hub.

ADVERTISING

Let's Get Digital

Thanks to all you e-boys and e-girls, internet advertising revenues in the U.S. hit $107.5 billion last year—the first time the figure made it past $100 billion.

So say the experts at the IAB and PwC, which conducted the study. They found digital ad sales climbed 21.8% annually last year, easily outpacing growth across other media.

• Because like checking in on Nana, print subscriptions are at best a Sunday thing for most people—newspaper ads fell 6.9% and magazine ads 2.1% in 2018.

Putting it in perspective: 75% of internet ad revenues in Q4 were concentrated in the top 10 (unnamed) ad sellers. But we’re happy to name a few. eMarketer recently suggested Amazon, Facebook, and Google alone will claim almost 70% of digital ad spend in the U.S. by 2021.

So what comes next now that digital has eaten the competition? It has its own concerns with lawmakers. The idea of breaking up some companies nauseates Big Tech c-suites, which view legislative interference as misguided and a serious growth impediment.

+ Chart for the road: Mobile on the rise.

SPORTS

There’s No Wrong Way to Prepare for the 2019 Rugby World Cup

Players are setting PRs on squats, we’re Googling “difference between rugby and Quidditch,” and restaurants and bars in host country Japan are loading up on beer.

...they don’t really have a choice. According to Jiji Press, the Japanese organizing committee has told businesses to ensure they have adequate supplies of beer in anticipation of the World Cup, which starts this September and is expected to draw 400,000 international fans who could go drink for drink with Tormund Giantsbane.

A final stat that’ll make you glad you opened this newsletter: The committee said that beer consumption at games during the 2015 Rugby World Cup in England was more than six times the amount consumed during soccer games at the same venues.

WHAT ELSE IS BREWING

• Bristol-Myers Squibb (-1.83%) is fixing to sell $19 billion of debt to fund its takeover of rival Celgene, per FT. It was either that or a lemonade stand.
• Disney (+1.11%) is on a box office high, and it announced the release dates of more Star Wars and Avatar films through 2027.
• Papa John’s (-3.87%) may not be Domino’s, but it’s definitely getting closer. Sales shrinkage last quarter wasn’t as bad as analysts anticipated.
• Match Group (+6.84% after hours) reported strong earnings thanks to more Tinder subscribers. Glad we could do our part.
• HBO removed that infamous Game of Thrones coffee cup, but one marketing expert said it netted Starbucks $2.3 billion in free advertising...and it wasn’t even a Starbucks cup.

BREAKROOM

From the Crew
It’s the defining question of our time: What does this emoji mean?

Food Trivia
What share of food delivery in the U.S. is pizza?

Breakroom Answers