Netflix is Alive

Also in today's edition: FB keeps $1b for creators, TikTok reaches $3b, Mastercard barred

Good morning! Economists usually have boring indicators that point to recovery. But it seems they have found one, which has more, erm, fizz. Champagne exports are up 43%. China and Canada are the two biggest importers of the bubbly, a Bloomberg report says. Vaccinations have increased, people are out, the sun is shining, mimosas are being ordered.

Anyway, on to the day’s stories:

  1. Nothing beats Deepinder Goyal’s Twitter feed and the Zomato IPO. 

  2. Twitter and Clubhouse introduce a little friction. 

  3. Meesho has a package for you, even if you didn’t order one.

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Zomato Is Killing It

The food-tech unicorn opened its doors to a public issue yesterday, and got a thunderous applause.

The day began with news that anchor investors had picked up shares worth INR 41.95 billion ($563 million) at INR 76 apiece. Among them were Tiger Global, BlackRock, and mutual funds of SBI, Axis, and HDFC banks. This got the issue off on the perfect note. Retail investors were so excited that their quota was subscribed 2.69 times. Let’s break it down for you.

You see, Zomato’s IPO is open to two different types of investors: retail and qualified institutional buyers (QIB). As a company which isn’t yet profitable, it must reserve 75% of the total shares for QIBs. Anchor investors can be allotted upto 60% of the shares reserved for QIBs, as above.

It indicates enthusiasm for the stock and the company. The overall issue was subscribed 1.05 times on day one of the offer which will remain open until Friday.

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Kerala’s Valuation Discount 

The share price of Kerala-based Kitex Garments has zoomed on reports that it will move out of the state. The stock hit the upper circuit on three consecutive days and closed at its 52-week high of INR 204.05 per share yesterday, shedding what would seem to be the valuation discount of Kerala.

Strategic shift: The world’s largest infant apparel maker said it was shelving investment plans for its home state allegedly because of relentless raids and inspections. Instead, Kitex chairman Sabu Jacob said, the company would put INR 10 billion ($134 million) in a Telangana textile park.

Political moves: There is an element of political rivalry too as Kitex’s CSR initiatives include Twenty20, an organization that fought and won four panchayats in local body polls. It also made failed bids for eight assembly seats in April.

Doing business: Kerala, famous for its public service, has had a chequered relationship with private enterprise. Aditya Birla group’s Mavoor Rayons was known for long-drawn worker agitations in the 1990s. More recently, Coca Cola had to leave the state following protests, and Pepsi shut down its unit last year.

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Netflix vs Disney And It’s Live

What would you give to play games with Simon Bassett? Well, you just need a Netflix subscription. Word’s out that the streaming platform has signed a deal with "Bridgerton" television producer Shonda Rhimes for three more seasons of the show plus feature films, gaming, and live events. No, really, there is a real life Bridgerton themed ball that is on the anvil. Put on your frilly frocks.

Competition time: With 82 million viewers as of early this year, Bridgerton is one of the most-watched shows on the platform and on linear television. But why events? Netflix wants to take on Disney at its own game by making events out of exclusive content.

Interactive engagement: As attention spans dwindle and customers have varied options to choose from, OTT and social media platforms are experimenting with different ways to reel people in. For instance, TikTok recently launched a pop-up store in the UK for fans to network with platform stars, receive tips, and co-create content.

Scale, baby, scale: One thing that gives Netflix hope is the ability to create multiple live events like the ball. Imagine being invited to a Stranger Things themed DnD event. Or a cosplay evening in the Witcher universe. I am sure you would pay to spend a night in one of the mansions that were used to shoot The Haunting of Bly Manor. Ka-ching!

The Signal

As the pandemic eases, audiences want to step out for real life experiences. In the time they spent cooped up at home, fictional characters became emotional companions. Non-content and offline events involving them would likely be a big draw. Viewers have thronged events such as Monster Jam, the West Virginia Home Show, and LEGO festival in the past few weeks. That makes space for pushing the boundaries on what OTT platforms do. With the way things are going, it wouldn’t be surprising if Netflix launched into offline amusement parks and gaming centers, just like Disney.

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Twitter And Clubhouse Take It Slow 

Social media companies grew on the back of creating a “seamless experience” in connecting people and sharing just about anything. That fuelled engagement while addicting people — through likes, shares, or replies, all key metrics of user validation.

Gradually, the perils of grow-at-all-costs started to show. Now, having seen the consequences on the state of speech and online discourse — rampant abuse, misinformation, conspiracy theorising — and their respective offline impact, the scaleback is beginning. They want you to pause before you share and behave in a group or a room.

How exactly? Last year, Twitter allowed users to limit tweets to users, to dissuade the "reply guys". Now it is doubling down on that feature, even after the tweet has been posted. 

Facebook’s groups, over the years have been micro filter bubbles of their own, with several bad actors taking advantage of group-think. Even as it has empowered group admins, it now wants to introduce a layer of “expertise”, to slow misinformation. The social audio app Clubhouse is now working on giving users the option to report an entire room.

The bottomline: Friction is good. Read before you tweet. Or re-share. Or like. Slow it down.

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The Haunting Of Meesho

Picture this: a delivery executive turns up at your place with an unmarked parcel to be paid on delivery, a few hundred Rupees. Maybe you ordered something and forgot about it, or someone from your household did. So you accept it and fork out the relatively small amount. Boom. Haunted.

Huh? There are a number of complaints piling up online about the delivery of unordered items from Meesho. A closer look from Entrackr reveals that some resellers on the social commerce platform are making a practice of sending CoD orders to oblivious people. These are known as “ghost” orders.

The SoftBank-backed company dropped its own commissions substantially last year, leading to a drop in the prices of the products. That’s perhaps why resellers got creative in making up for this loss in earnings.

The resellers face practically no risk. If the customer accepts, they earn a handsome commission. If not, the items return to them on Meesho’s dime. Some of Meesho’s policies such as sending goods in unbranded packets and volume-based incentives to resellers may be an added incentive.

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What Else Made The Signal? 

Price to pay: The Reserve Bank of India has barred MasterCard indefinitely from issuing new debit, credit, and prepaid cards until it complies with local data storage rules.

You know what’s cool? A billion dollars. That’s how much Facebook’s setting aside for paying creators through the end of 2022. Sounds unbelievable? It came straight from the horse’s mouth.

You know why? Probably has at least a little to do with the fact that TikTok became the first non-Facebook mobile app to reach three billion global downloads.

Gimme more: Apple has instructed suppliers to manufacture ~90 million next-generation iPhones for 2021, nearly 20% higher than 2020 iPhone shipments.

Dishing out: Amazon is entering the satellites and broadband services space in the US and has acquired Facebook’s satellite internet team.

Take off: Adani Airport Holdings has taken over the management of Mumbai International Airport from the GVK Group on Tuesday.

No thanks: Semiconductor maker Broadcom has dropped plans to buy SAS Institute after the latter’s founders changed their minds about a sale. The deal would have been valued at anywhere between $15 billion and $20 billion.


Fun Signals

Grand slam: Mattel’s Barbie Role Model Naomi Osaka dolls have sold out within a day of their release. Osaka is currently second in the WTA women’s singles rankings and has been outspoken on several issues surrounding human rights, racial injustice, mental health, and more.

Go slow: South Korean capital, Seoul, has banned fast music ie. higher than 120 bps in gyms as a Covid-prevention measure. Treadmills can also no longer be operated faster than 6.4 kmph. These are intended to prevent people from breathing too fast or splashing sweat onto other people.

Double dose: Kraft Heinz has teamed up with Brooklyn-based Van Leeuwen to offer a limited edition of macaroni and cheese flavoured ice cream. Putting together two beloved comfort foods, what could possibly go wrong?

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