Instagram’s long con
Also in today's edition: Floyd Mayweather on OnlyFans, Vedanta's clear on Videocon, TikTok's safe in the US.
Good morning! The ink on Tata’s deal with Curefit was barely dry and the conglomerate, it seems, is making a play for everyone’s favourite concierge company, Dunzo. A Mint report states that Tata Digital will acquire a controlling interest in the startup, which has Google on its cap table. Dunzo will be valued anywhere between $150 million and $200 million.
Anyway, on to today’s stories.
You can go to jail for tweeting.
Amazon vs SBI Unions. There’s a fight brewing.
Atmospheric CO2 level highest in 4 million years.
Instagram: The New Marketplace
At the time when Apple’s WWDC is grabbing headlines, Facebook’s creator week has sort of slipped under the radar.
During this week, Mark Zuckerberg introduced the millions of creators on his platform to new ways of making money. Let’s list some highlights.
Advertisers will be able to track where a lead originates. If it did from a creator, then the creator gets paid.
Instagram is also letting small sellers set up stores within the app so the purchase cycles stay within the Facebook ecosystem.
For now, Facebook says it won’t ask for commissions from any of these sales. Not until 2023. But even then it promises it won’t demand the 30% that Apple charges.
So much largess: Instagram isn’t doing this out of love for the creator ecosystem. Even if the platform won’t take a penny from these purchases, it gets data. Not just about the buyer, but also the seller.
How can this scale-up? Let’s imagine company A needs to sell its new line of shoes. It can find a popular creator and negotiate a deal. Or it can go to Instagram and ask the platform to help find a creator who will not only fit the budget but also the target audience. That’s when Instagram truly makes money.
Your Next Tweet Could Land You In Jail
… in Nigeria, where the government has threatened to arrest anyone found using the micro-blogging app to tweet. But several people have been doing it anyway — defying orders, using workarounds like virtual private networks, whose demand has spiked since June 5, when the Twitter ban came into effect. Since then, the government has been in discussions with Twitter. Unsurprisingly, the ban was endorsed by former US President Donald Trump.
Beyond Nigeria, election-bound Russia has been adopting similar tactics to squeeze social media platforms, Twitter, YouTube, TikTok, etc., into removing “anti-government” content. The Russian government has classified a growing number of posts as “illegal” and has issued a flurry of takedown requests. These actions are besides other actions that include legislations and stringent data protection laws.
Pushing The Boundaries Of Finance
A group of Indian and global trade unions, including the SBI staff union, has written to the RBI, asking it to reconsider its New Umbrella Entity (NUE) framework. Under the framework, the central bank is accepting applications for umbrella entities that facilitate retail payments, similar to the government-owned National Payments Corporation of India (NPCI) which runs UPI. The unions are opposed to multinational private corporations owning payment infrastructure fearing it could compromise India’s data sovereignty.
Pincer moves: Meanwhile, Amazon and Google reportedly want to pick up a stake in Bengaluru-based neo-bank, Open, which is reportedly looking to raise $100-120 million. The two global companies are also in the race for NUE licences. Amazon is in a consortium with ICICI Bank, Axis Bank, Pine Labs, BillDesk, and Visa while Google has teamed up with Reliance Industries, Infibeam Avenues, and Facebook.
Changing the game: Like many other sectors, technology is disrupting banking too. Blockchain-based DeFi or decentralised finance applications provide financial services while cutting out the middleman — banks. Well capitalised tech behemoths look at it as low-hanging fruit. Hence the rush to own not only customer-facing banks but also the infrastructure at the backend.
The banking system is transforming. Breakthrough developments in technology have helped make financial transactions safer, trackable and cheap. Traditional financiers are saddled with high legacy costs and stiff regulatory requirements that increase their cost of capital and curtails the freedom to operate. The nimble-footed, digital-first challengers appeal to the millennials who are comfortable transacting on phones and sharing personal information. Besides, India is heavily underbanked. Cost-effective, technology-driven banking could help millions who cannot afford financial services today. The bottom of the pyramid is a goldmine too.
Pay More Taxes, Mr Musk
Jeff Bezos is leaving for outer space soon, but he has reportedly forgotten to perform some of his earthly duties — pay his rightful share of federal income taxes. Not just Bezos, fellow space enthusiast Elon Musk is also in the list and so are 23 other richest Americans.
According to an analysis by the news organization ProPublica, America’s richest just paid $13.6 billion in federal income taxes between the years 2014 and 2018, even though their collective net worth increased by $401 billion.
Income vs Wealth: The country’s tax system benefits its big shots who pay taxes on their incomes but not their wealth. While US President Joe Biden is working towards overhauling the tax code to make the rich pay more, his focus remains on income.
The report opens a rare window of opportunity for the US, which is trying to reform its tax system. As Massachusetts Democrat, Senator Elizabeth Warren points out, “The real action in America is on wealth, not income”.
Note: According to the NYT report we’ve cited, ProPublica did not reveal how it obtained the information, and the paper could not independently verify it either.
Building Up To A Disaster
The pandemic may have brought the world to a standstill, but the concentration of greenhouse gases in the Earth’s atmosphere has remained spectacularly high; at levels not seen in ~4 million years.
Atmospheric carbon dioxide levels touched a monthly average of ~419 parts per million (ppm) in May 2021, compared to 417 ppm the previous year.
It’s still burning: We already know that fossil fuel usage is the primary contributor to the climate crisis. If we want to save the planet, reducing our carbon emissions to zero has to be our utmost priority.
Turning green: Climate change causes extreme weather conditions, makes oceans more acidic and affects all living beings. The 40 billion metric tons of CO2 we add to the atmosphere annually keeps the heat trapped in it. If that continues, there’s a good chance it will edge the Earth’s annual temperature past the Paris Agreement limits in five years.
Switching to greener alternatives is the only option we have. Or else, we’re diving headfirst into a disaster, pandemic or no pandemic.
Catching Up With Covid
92,596: The number of new cases of Covid-19 reported in India for Tuesday.
2,219: Deaths due to Covid-19 reported in India for Tuesday.
Protect the animals: After the tragic death of an Asiatic lioness showing Covid-19 symptoms, India has temporarily closed all tiger reserves and is testing elephants.
Herd immunity: Experts are speculating that San Francisco may be the first major US city to achieve the feat, as fresh Covid-19 cases aren’t triggering wider outbreaks.
It’s everywhere: The delta variant of the virus, first discovered in India, has also been detected in 428 out of 449 cases from variants of concern in Singapore.
What Else Made The Signal?
Keep away: Sebi has restrained the head of Franklin Templeton Asia Pacific, Vivek Kudva and his wife Roopa Kudva, MD of Omidyar Network India, from trading in the securities market for one year.
Instabrands: Digital payments company, Instamojo, has forayed into e-commerce via its latest avatar of becoming a platform for direct-to-consumer brands. This gives us 2015 feels.
Bring it home: A bankruptcy court cleared the sale of Videocon to Vedanta Group’s Anil Agarwal.
Floyd Fans: Floyd Mayweather, who recently fought YouTuber Logan Paul in an exhibition boxing match, has joined adult entertainment website OnlyFans. He wants to give fans a peek into his life. We hope it is more interesting than the fight, at least.
EU antitrust saga: The EU said Big Tech’s voice-enabled assistants, Alexa, Siri and Google Assistant, have triggered anti-competitive concerns.
More chips for the US: The United States Senate passed a bill sanctioning $50 billion to boost the semiconductor, AI and other tech sectors. This is aimed at keeping up with international competitors, especially China.
TikTok is not going away: President Biden has withdrawn a bill that Trump had been eyeing to ban apps like TikTok and WeChat. Instead, Biden is taking a broader view to weed out foreign apps that could pose a potential security threat.
The outsiders: Cryptocurrencies have gone mainstream. Many Latin American politicians are in favour of making Bitcoin as legal tender. El Salvador’s 39-year-old President, Nayib Bukele, had kicked off the trend.
Want a joint? Get vaccinated. Americans older than 21 in the state of Washington can take away a free marijuana joint for a Covid-19 shot. The “Joints for Jabs” drive is a way to encourage citizens to get vaccinated while also promoting cannabis retailers. Arizona is also giving out pre-rolled joints and gummy edibles, and New Jersey had handed out free beers in May to those who got a shot. Way to make the vaccination drive fun and amp up motivation, eh?
Your Savior Is Here! The weekend is only a day away, and you are wondering what to watch. Are we right or are we right? Fret not, for Loki, the God of Mischief, has just landed on Disney+ Hotstar. It premiered on June 9, and is a stand-alone, six-part series. After ‘WandaVision’ and ‘The Falcon and the Winter Soldier’, ‘Loki’ is the third installment of the Phase Four line-up.
Sushi bar at home: Japan has extended a state of emergency in many parts of the country. As people prepare to stay indoors, one restaurant chain, Kappa Sushi, has come up with an idea that allows you to replicate the sushi bar experience at home. Takeout customers can buy a mini version of conveyor belts — sushi bar staples — for the low, low price of 3,300 yen ($30). Why eat sushi the boring way when you can do it bar-style?