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| Happy Monday, Insiders!! Today's Business newsletter covers: - 🎧 Spotify's podcast empire is in trouble
- 🔍 Deep Dive: How does Coca-Cola's strategy of No politics, more AI, and live events help?
- 🤝 U.S., Vietnam firms ink deals on AI, aviation during Biden visit
If you enjoy reading this newsletter, please share it with your friends and colleagues. Make sure to continue reading for Quick Hits and the Knowledge Hub. Thank you!! Shriram
p/Shriram | |
| 1 | | With over $1B spent on original content and celebrity deals, Spotify has substantially invested in podcasting, yet most shows are still not making money. Due to this, Spotify reported losses of $565M in the first half of 2023 despite $6.6B in sales. More: - Despite estimates that U.S. podcasting income will reach $2.3B in 2023, Spotify's significant investments in podcast content haven't yielded the promised returns, and the business is now aiming for podcast profitability by 2024.
- Spotify has increased subscription costs, reduced staff and programming, and shared income risk with artists to become profitable.
- Spotify intends to increase its podcasting operations and produce considerable ad revenue despite obstacles to becoming an audio behemoth with $100B in revenue by 2030.
- According to the business, the number of podcast listeners on the platform has increased ten times since 2019, when it reported 220 million paid users (100 million podcast listeners) to its premium service in June.
Q: Given the struggles of Spotify in making its podcasting investments profitable, how important is diversifying revenue streams beyond music streaming to its long-term success? Join the conversation here. |     | |
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What the numbers say: The volume share of Coca-Cola in the U.S. market for nonalcoholic beverages decreased from 28.9% in 2013 to 23.1% in 2022. Despite obstacles, Coca-Cola's market share remained stable last year after dropping for eight of the previous nine years. According to Duane Stanford of Beverage Digest, Coca-Cola's soft drink sales have decreased due to heightened competition and a shift in customer tastes toward functional beverages like energy and fruit drinks. Relevance: Coca-Cola changed its marketing strategy to emphasize long-term customer base expansion over quick profits. Instead of using TV advertisements, it now focuses on events and digital efforts to reach consumers without addressing political topics. Moving away from Web3 and metaverse trends, the organization has adopted generative AI in marketing while overcoming hiring and legal hurdles. More Data: Coca-Cola is currently consumed with pizza by 20% of Italians, up from 10% four years ago, thanks to regional multimedia efforts. Recent NFTs by Coca-Cola and Coinbase generated more than $0.5M in revenue in just 72 hours. | | | |
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| 3 | | During President Biden's visit to Hanoi, executives from significant American tech, semiconductor, and aviation companies met with Vietnamese counterparts to discuss collaboration in AI, semiconductors, and cloud computing. Strengthening U.S.-Vietnam tech connections is strategically vital because of Vietnam's position as a critical source of minerals, such as rare earths, for EVs and wind turbines. More: - Deals announced during the trip include Vietnam Airlines' $7.8B acquisition of 50 Boeing 737 Max aircraft.
- While Nvidia and Microsoft will work together on AI projects with Vietnamese businesses, Microsoft intends to develop a generative AI solution specifically for Vietnam and emerging countries.
- Marvell, Synopsys, and Amkor are three American companies investing in Vietnam's chip industry, and Amkor's new $1.6B factory is about to start production.
- The expenditure is comparable to Intel's $1.5B chip assembly facility in the nation's south, the most extensive facility the corporation has ever built globally.
- The White House also announced that American corporation Honeywell will work with a Vietnamese partner to establish a pilot project to create Vietnam's first battery energy storage system.
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| 4 | | Apartment rent growth has slowed significantly, says real estate tech company RealPage, with August rates up just 0.28% yearly compared to an 11% rise the previous year. However, despite the slowdown in rent growth, occupancies in the country are still strong at 94%. More: - An enormous increase in apartment availability is the biggest problem influencing the rental market.
- This year, the building is anticipated to reach a 50-year high with the completion of around 460,000 new housing units.
- Over 1 million new apartments have been created in the last three years, with a sizable proportion being higher-end residences.
- While the Midwest and Northeast continue to suffer rapid rises in rent, specific local markets, including Austin, Phoenix, Las Vegas, Atlanta, and Jacksonville, have already experienced negative growth.
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| 5 | | BMW will invest over $751M in its historic Oxford, U.K., plant to produce electric Mini models, securing the factory's future while boosting the struggling domestic auto industry. The plant will continue making combustion engine Minis until 2026 before switching partially to electric Mini hatchbacks and crossovers. More: - The Oxford facility will only produce electric vehicles (EVs) beginning in 2030.
- Since 2020, the U.K. has received over $7.5B in investments in the auto industry, significantly less than North America's $72B total, but the government views this as a success for its automotive plan.
- The Financial Times stated the U.K. government will provide about $93M in taxpayer money to support BMW's project.
- BMW's investment comes as the U.K. deals with issues like rising energy prices, Brexit regulations, and zero-emission vehicle standards.
Zoom Out: - Tata Group, owner of Jaguar Land Rover, made plans for a $5B U.K. battery project that will begin delivering cells in July 2026.
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| 6 | | In an agreement worth up to $1.7B, Moderna and Immatics are working together to develop mRNA-based cancer medicines. Immatics developed the COVID vaccination using mRNA technology. The partnership covers antibody, vaccine, and cell therapy products as Moderna seeks to expand mRNA's use in oncology. More: - The Immatics collaboration allows Moderna to develop an mRNA cancer vaccine to pair with Immatics' IMA203 cell therapy, expanding mRNA applications while Immatics spearheads initial trials.
- Under the partnership, Moderna will develop and commercialize mRNA cancer vaccines and therapeutics, including new vaccine targets and antibody treatments.
- On a personalized cancer vaccine for melanoma and other tumors, Moderna has already teamed up with Merck & Co., though clinical testing might take several years.
- As sales of COVID-19 vaccines drop, Moderna is expanding its portfolio beyond these products and emphasizing mRNA-based therapies for diseases including cancer.
Zoom Out: - The price of Moderna's stock has dropped by 40% since the year's start.
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| 7 | | Quick Hits: - How much should you pay influencers in Q4? Get the benchmarks in this blog.*
- According to Morgan Stanley, Tesla's Dojo supercomputer, which it intends to spend over $1B on, could accelerate the adoption of robotaxis and software services and increase the company's market value by almost to $600B.
- On Monday, Alibaba shares dropped more than 4% in Hong Kong as concerns about the spin-off plan and potential leadership strife were raised by the resignation of former CEO Daniel Zhang, who had switched to cloud computing only two months before.
- As part of a $18.7M experiment on automated air traffic control, U.K. researchers built an artificial intelligence (AI) "digital twin" model of England's airspace to investigate whether AI might counsel or replace human controllers.
- The largest pension fund in Australia invested $1.6B in a significant European data center business, demonstrating the institutional need for digital infrastructure to support the expansion of cloud computing and AI.
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Term of the Day 51% attack: A 51% attack occurs when an entity takes control of more than 50% of a blockchain network's hash rate. Question of the Week Do you share details about your salary with your coworkers? Join the conversation |
INSIDE BUSINESS LEADERBOARD (7 DAYS) |
 | Freelance Writer | | Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. | | This newsletter was edited by Aaron Crutchfield | |
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