Data Sheet—Bitcoin Bites It
Three quick tech thoughts to start your day:
- Bitcoin biting it. Its price has fallen below $4,000, from a lot more than that a year ago. Other so-called “cryptocurrencies” have fallen equally dramatic amounts. This is the bursting of a classic speculative bubble—with a twist. There never was any intrinsic value to the stuff in the first place. Tulips, after all, are pretty and therefore have a market. Internet companies could generate revenues, so some of them also could generate income.
- Trump attacking Apple. I’ve felt for a while now that we’d know things had gotten bad when the president trained his trade-war sights on Apple. After all, hundreds of thousands of Chinese jobs and millions of pampered consumers (in China and the West) depend on comity in U.S.-China trade relations. The leader of the free world told The Wall Street Journal Monday that levies on iPhones and MacBooks made in China are on the table. This thing is getting real.
- General Motors giving up on cars. GM announced massive layoffs, factories closures, and the shuttering of most of its passenger-car lines that include combustion engines under the hood. It took a decade for predictions of ride-sharing, self-driving, and electrification to come true. But it’s coming true. And now even healthier auto companies, like GM, are adjusting their strategies—and balance sheets—accordingly.
Media dumpster fire: A blockchain-based media startup known as Civil was supposed to "save journalism" with an elaborate token and blockchain scheme but quickly descended into collapse and confusion. Now, journalists who worked for it say Civil stiffed them by failing to deliver tokens that were to have been up to 70% of their compensation.
Social media dumpster fire: Facebook in October unveiled a so-called "War Room" to combat election chicanery and generally clean up the toxic content poisoning its platform. Skeptics decried this as a PR stunt—and they might be right as said War Room is no more, reports Bloomberg in yet another takedown of embattled COO Sheryl Sandberg.
Meet the new ad boss: Good news for those upset about the duopoly that dominates online advertising: a competitor has arrived to challenge Facebook and Google. Alas, the competitor is none other than another tech behemoth, Amazon, which, per the WSJ, "threatens to upend Silicon Valley’s ad titans and change the way business is done on Madison Avenue."
Bitcoin will be back—eventually. Not everyone shares Adam's acerbic view of Bitcoin, which is much more useful than tulips IMO. VC and crypto vet Fred Wilson acknowledges the current slump could last a long time, but reminds us Amazon's early trajectory—when prices fell from $90 to $6—provides a parallel, and a reason for long-term optimism.
ON THE MOVE
(Data Sheet is experimenting with a new weekly section covering executive moves of interest in the tech industry. Please let us know if you find it useful.)
Amazon vice president of finance Jason Warnick is leaving to become CFO of millennial stock app Robinhood...Facebook has hired long-time Justice Department antitrust veteran Kate Patchen, presumably to help it ward off calls to break up the company...Coinbase lawyer and policy head Mike Lempres is leaving to join Andreessen Horowitz...Airbnb poached Amazon vice president Dave Stephenson to be its CFO.
FOOD FOR THOUGHT
Video game pioneer Atari was little more than nostalgia in 2013, with lots of debt and no viable business. But a new CEO, Frederic Chesnais, effected a remarkable turnaround, allowing Atari to thrive again as both a software and hardware play. In a nice lesson on the power of brand, Chesnais tells VentureBeat how he pulled it off:
[W]ithout the brand, would we have been able to make it back out of bankruptcy? I don’t think so. Remember where we’re coming from. You’ve seen the deck, the table that shows we started in 2013 with €1 million in revenue and more than €30 million in debt. Today, we have €18 million in revenue and no debt. We’re profitable. Without the brand, that would have been very difficult.
The brand helps us in two different ways. One, it helps to be able to contact someone by saying, “We’re Atari. We’d like to do this. Would you like to have a meeting?” Most people will say, “Wow, you guys are still alive? Sure, just stop by.” It opens doors. Second, it still has a lot of awareness, a lot of following. We’ve been able to make licensing arrangements with advances and minimum guarantees. It helps a lot there. When you have a product like Atari Flashback, it’s good to have the brand going with it. It’s helped us make licensing agreements and get cash when we needed it. Let’s get this license signed and get $600,000. Maybe it’s not the best deal ever, but we need $600,000. Let’s swallow that and move on. I’m grateful for that.
IN CASE YOU MISSED IT
BEFORE YOU GO
Government tech innovation can be an oxymoron—but not always. A self-described "civic hacker" in Washington D.C. explains how he helped put authoritative versions of the District's laws on GitHub, making the law more accessible and transparent than ever. The system even allows citizens to call attention to errors or typos.