Brother bother
Also in today’s edition: Private investors bite the bullet; Apple’s headset headaches; Cue right-wing AI chatbots; No country for overseas tourism offices
Good morning! Let’s play a guessing game:
Two desolate buildings, five lecture halls, six permanent faculty members, and 120 students. Is this a coaching centre or an Institution of Eminence (IOE)? If you guessed the former, you’re wrong. This is the 52-acre Jio Institute, operated by the Reliance Foundation in Ulwe, on the outskirts of Mumbai. The Indian Express reports that the centre—one of many that applied for IOE status under the Indian government’s University Grants Commission—still awaits clearance after getting approval from an Empowered Experts Committee (EEC). All because the EEC’s term hasn’t been renewed since 2021. Not even India’s shrewdest biz family can deal with the lumbering elephant that’s Indian bureaucracy.
Today’s edition also features pieces by Roshni P. Nair, Dinesh Narayanan, Srijonee Bhattacharjee, and Julie Koshy Sam.
If you enjoy reading us, why not give us a follow at @thesignaldotco on Twitter and Instagram.
The Market Signal*
Stocks & economy: Indian equities may rise on cues from global peers. The SGX Nifty and early trade in Asia pointed to a higher opening for Indian indices.
Shares rose globally as appetite for riskier assets returned on First Citizens BancShares’ acquisition of Silicon Valley Bank.
Indian indices may be supported by banking stocks. The S&P 500 bank index rose 3% on Monday, after sliding 22% In March until then. IT stocks were under pressure globally due to the expectation that the US Fed may hike rates again in May.
The Indian currency may be weighed as the US dollar and oil prices picked up steam. In focus this week would be GDP data of the US and UK.
Gold prices in India are at record highs despite retail demand trailing off ahead of a key festival, indicating investors might be buying the metal to hedge risk building in other assets.
MEDIA
Tricky Times
Samir and Vineet Jain’s plans to split up their media empire, The Times Group (TTG), have hit a roadblock, The Morning Context reported. Both are aligned on who gets what—Samir gets the news business, while Vineet retains his TV and entertainment empire. But the group’s complicated cross-holdings make the split tricky, especially with Times Internet Limited (TIL), TTG’s repository of digital businesses.
The complication is that TIL’s biggest businesses are websites for TTG news brands such as The Times of India. Without the news businesses, TIL is largely bereft of value. It has already sold some of its best-known businesses (Dineout, MX TakaTak, MensXP, and iDiva) and put up MX Player for sale.
Much of TTG’s nearly ₹8,000 crore ($971 million) revenue comes from legacy news. It’s also why its bottom line took a significant hit during the pandemic. Post-split, both businesses will have to find newer ways to generate sustainable cash flow.
THE SIGNAL DAILY
The Indian government has bestowed a temporary lifeline to NGOs by granting a six-month extension on their registration under the Foreign Contribution Regulation Act (FCRA). But is it actually a relief for the NGOs? In other news, Lebanon seems to be stuck between two seemingly rival time zones. What’s the reason behind this?
Tune in to The Signal Daily to know more!
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PRIVATE EQUITY
Deep Pockets Go On A War Footing
Socially responsible investing be damned, investors are betting on strife. While the US is counting on Silicon Valley to pump money into defence, European funds are investing in military and military-adjacent supply chains.
The Joe Biden administration, which is at increasing odds with China*, has requested $115 million for the Pentagon’s Office of Strategic Capital. This is a significant shift for the Department of Defense, which relies on select military contractors.
For private investors, defence is recession-proof, especially after the e-commerce and crypto downturns.
In Russia-wary Europe, the likes of former Airbus executive Marwan Lahoud and healthcare honcho Serge Weinberg are raising millions of euros for defence-focused funds. In 2022, such funds invested €96 million ($103 million) in European defence companies, the highest in 10 years.
*Speaking of China, the US now has its guard up against state-owned ZPMC, which accounts for 80% of the global market for port services solutions.
TECHNOLOGY
Mixed Bag For Apple
We’ll cut to the chase. Apple’s fledgling mixed-reality headset ambitions are ruffling feathers in the company, The New York Times (NYT) reported. This coincides with last week’s closed-door demo at The Steve Jobs Theatre, where Apple huddled its 100 top leaders ahead of a June launch.
All’s not well: The NYT claims there’s dissension within Apple over the mixed-reality project, including employees defecting and getting fired due to a “lack of progress”. Morale post the 2019 departure of Apple design guru Jony Ive hasn’t been great either.
Timing: Unlike the iPhone and other core Apple products, the mixed-reality foray comes at a time when the industry is in flux, with virtual-reality headset sales declining in 2022. Meta’s not saying it, but Mark Zuckerberg has switched focus to the next big thing: AI.
The Signal
A mixed-reality headset is unfamiliar terrain for Apple. As Bloomberg’s Mark Gurman writes, with other products such as the Mac, iPod, and iPhone, Apple “essentially created a better version of a product that people were familiar with.” That’s not the case with the headset.
Add to that the $3,000 price tag and a clunky experience—which Gurman says might involve “replacing an external battery after every two hours”—and the headset is far removed from the Apple experience. It’s curious that this passes muster for the company, considering it’s expected to ship a lower number of headsets (500,000 units, per NYT) than originally estimated (one million units, per Gurman’s company sources).
ARTIFICIAL INTELLIGENCE
Budding Echo Chambers
The generative AI hype cycle is now segueing into… the culture wars. Conservative and conservative-curious technology entrepreneurs are looking beyond Big Tech-developed chatbots such as ChatGPT’s “Woke AI”, to quote Elon Musk.
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1. Behold RightWingGPT. An AI model fine-tuned to manifest the opposite political biases of ChatGPT (i.e. to be right wing). Let me describe how I did it and the dangers of politically aligned AIs given their potential to induce societal polarization | |||
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Why?: It’s simple—bias, which OpenAI’s Sam Altman flagged multiple times as a shortcoming. The issue, alongside misinformation, has already been a decades-long source of concern for AI ethicists, who’re raising the alarm over the “move fast and break things” approach to AI. Throw in politically-motivated approaches to training large language models, and you have a recipe for social upheaval.
What then?: Conservatives don’t want to make the mistakes they did with social media, which they accused of discriminating against them. They’re getting into the act already via far-right social network Gab’s AI plans, or Musk building a counter to OpenAI.
TOURISM
The Outposts Are Shuttered
Just when people began to travel for business and leisure, India has decided to close down its dedicated tourism promotion setups in major global cities.
The seven remaining Overseas India Tourism Offices will be shut by the end of the week. The rest are already closed, even though there is demand for their services. India now plans to station tourism officers at its missions, which has not gone down well with the resources-starved diplomats.
The Union Budget for 2022-23 had allocated ₹341 crore (~$41 million) to the tourism ministry for promotions and marketing overseas. However, it was revised down to ₹60 crore. The allocation has dropped by half to ₹167 crore for 2023-24, Budget documents show. The ministry’s outcome statement for 2022-23 shows it has managed to meet only 5% of its targeted foreign tourist arrivals and forex earnings.
FYI
Red signal: Indian skincare company Mamaearth is shelving its initial public offering because of weak economic conditions, Reuters reported. OYO is also cutting its IPO size by two-thirds, per Bloomberg.
Homecoming: Almost a year after he left mainland China, Alibaba founder Jack Ma returned to Hangzhou to visit a school funded by his company.
NoGPT: Chinese search giant Baidu has called off the public launch of its AI-based chatbot “Ernie bot”. Instead, it organised a closed-door meeting for its enterprise clients.
Left the building: Ammar Al-Khudairy, the chairman of the Saudi National Bank, resigned on Monday due to “personal reasons.” Al-Khudairy’s resignation immediately comes after Credit Suisse’s buyout, where Saudi National Bank was the largest shareholder.
Ship gone: After a long hiatus, the Jolly Roger was spotted on the African coast again. Pirates hijacked a fully laden ship, Monjasa Reformer, off the Congo shores.
Under pressure: Japan is mulling a restriction on TikTok and other apps if it is found to be peddling disinformation.
Crackdown: US financial regulator, the Commodity Futures Trading Commission, has sued crypto giant Binance and its CEO Changpeng Zhao for operating illegally and violating compliance rules in the country.
THE DAILY DIGIT
$17.1 billion
The estimated amount the UK government has missed out on in “sin taxes” since 2002 because Gen Z is increasingly staying away from smoking and drinking. (Bloomberg)
FWIW
Pro-roller: This is a record worth bragging about. Thai local Ativat Janmuangthai is the country’s fastest joint roller—he took just 43 seconds to roll a 1 gm joint. Janmuangthai also won a cash prize of 5,000 baht ($146.37) and a trophy. This contest comes at a time when Thailand eased the ban on the recreational drug in June 2022, but its fate could turn with the upcoming elections in May. About 1,000 licensed dispensaries in Phuket stand to lose. For what it's worth, we hope Janmuangthai got a chance to celebrate the win with his labour of love.
On its last kegs: Belgium's famous cultural export, the Trappist beer, may be under threat. The dwindling number of priests has a lot to do with it. Westmalle, one of the remaining five “real” Trappist beers, is considering becoming a foundation to safeguard its future. Belgian beer Achel lost its hallowed Trappist beer status in January after it was sold to an entrepreneur. There is a joke about the miracle of the loaves and fishes to be made here.
What room service?: Staying in a hotel room usually means not having to worry about cleaning up after yourself. Well, that policy has changed, no thanks to the Covid-19 pandemic. Hotels in the US are cleaning less frequently under the garb of sustainability. Of course, this cost-saving tactic is to protect their bottom line. Housekeeping unions say the stingy policy directly affects the cleaning staff, who are missing out on daily wages. Just a regular day under capitalism. ¯\_(ツ)_/¯