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jerryking : rana_foroohar   21

Tech innovation needs a level playing field
January 19, 2020 | Financial Times | by Rana Foroohar.

.........Creating an even playing field will require both monopoly scrutiny and a close examination of whether the pendulum in the patent system has swung too far towards benefiting tech companies that depend more on data and networks than patents, or have an interest in making it tougher to obtain patents.

Because their own products (for example, smartphones) require so many different bits of technology, the companies have an interest in keeping these inputs as cheap as possible. They can deploy legions of lawyers to protect any crucial IP of their own while “efficiently infringing” on the patents that belong to others (that’s the term for violations done knowingly by big companies as a cost of doing business).
......The US, in particular, has work to do there. “Our leadership on the global stage depends on our ability to promote and protect the innovations of American creators, engineers, and scientists,” said Democratic Senator Chris Coons, who has sponsored bipartisan legislation to strengthen America’s own IP protection. “I’m concerned that while our competitors — like China — strengthen their intellectual property regimes, we have been weakening our own innovation ecosystem.”
.......But the US has another problem — that of trying to compete with a state-run economy like China’s when it has no national innovation strategy. While large American companies are busy fighting each other in expensive legal battles to see who gets to set standards for smart speakers (or 5G, or AI, or a host of other areas), China is using its Belt and Road Initiative to roll out its own equipment, technology standards and interests across nations from Asia to Southern Europe. That’s not duplication. It’s just smart.
Big_Tech  China  cross-licensing  entrepreneurship  Google  industrial_policies  innovation  innovation_policies  intellectual_property  national_interests  One_Belt_One_Road  patents  patent_infringement  Rana_Foroohar  smart_speakers  Sonos  technical_standards  U.S.-China_relations 
4 weeks ago by jerryking
Consciously decoupling the US economy
December 1 , 2019 | Financial Times | Rana Foroohar.

The US is economically decoupling from the rest of the world.....Europe is being pulled into China’s technology orbit via the 5G standards and technologies that make up part of the Belt and Road Initiative......one of the most important things the US could do right now to ensure both national security and its own position in the 21st-century digital economy would be to work with allies on transatlantic standards for emerging technologies like 5G, artificial intelligence and so on....... decoupling is no longer a fringe idea......the Council on Foreign Relations (CFR) is now admitting that we are in a more fragmented world — one that won’t reset to the 1990s — and advocating what amounts to a US industrial policy--- a major shift in thinking. Deglobalisation, the idea of the US and China decoupling economically, is now mainstream.....heightened awareness of the relationship between national security and technology........it is becoming a given that the US needs a more coherent national economic strategy in a world in which state capitalism is in the ascendant. The question is how to get there. And that’s where the internal contradictions in America’s laissez-faire, free-market system start to become a problem......what role should government play?........What should the private sector expect from government and what should they be willing to do in exchange (e.g. Will FAANG repatriate profits to the U.S.? Will Silicon Valley and Wall Street volunteer to retrain the millions of underemployed millennials? How can we move from 40 years of supply-side thinking that has benefited multinational companies, towards something that better supports local economies and workers? ...if America is going to compete with a state-run economy like China in the digital era — one that seems to support a winner-takes-all dynamic — we are going to need bigger, public-sector directed shifts.
5G  adversaries  CFR  China  China_rising  decoupling  deglobalization  digital_economy  industrial_policies  military-industrial_complex  multinationals  new_tech_Cold_War  One_Belt_One_Road  public_sector  Rana_Foroohar  security_&_intelligence  state_capitalism  supply_chains  tariffs  technical_standards  technology  U.S.-China_relations  winner-take-all 
11 weeks ago by jerryking
Lina Khan: ‘This isn’t just about antitrust. It’s about values’
March 29, 2019 | Financial Times | by Rana Foroohar.

Lina Khan is the legal wunderkind reshaping the global debate over competition and corporate power......While still a student at Yale Law School, she wrote a paper, “Amazon’s Antitrust Paradox”, which was published in the school’s influential journal..... hit a nerve at a time when the overweening power of the Big Tech companies, from Facebook to Google to Amazon, is rising up the agenda......For roughly four decades, antitrust scholars — taking their lead from Robert Bork’s 1978 book The Antitrust Paradox — have pegged their definitions of monopoly power to short-term price effects; so if Amazon is making prices lower for consumers, the market must be working effectively.....Khan made the case that this interpretation of US antitrust law, meant to regulate competition and curb monopolistic practices, is utterly unsuited to the architecture of the modern economy.....Khan's counterargument: that it doesn’t matter if companies such as Amazon are making things cheaper in dollars if they are using predatory pricing strategies to dominate multiple industries and choke off competition and choice.....Speaking to hedge funds and banks during her research, Khan found that they were valuing Amazon and its growth potential in a way that signified monopoly power..." I’m interested in imbalances in market power and how they manifest. That’s something you can see not just in tech but across many industries,” says Khan, who has written sharp pieces on monopoly power in areas as diverse as airlines and agriculture. " Khan, like many in her cohort, believes otherwise. “If markets are leading us in directions that we, as a democratic society, decide are not compatible with our vision of liberty or democracy, it is incumbent upon government to do something.” Lina Khan has had a stint as a legal fellow at the Federal Trade Commission, consulted with EU officials, influenced competition policy in India, brainstormed ideas with presidential hopeful Elizabeth Warren and — recently joined the House Subcommittee on Antitrust, Commercial and Administrative Law. The 2008 financial crisis she thinks “about markets, and the government’s response to them, and certain forms of intervention that they do take, and that they don’t take”.....Khan, Lynn and others including the Columbia academic Tim Wu have developed and popularised the “new Brandeis” school of antitrust regulation, hearkening back to the era in which Louis Brandeis, the “people’s lawyer”, took on oligarchs such as John D Rockefeller and JP Morgan.....Lina sees Amazon as not just a discount retailer but as a marketing platform, delivery and logistics network, a payment service, a credit lender, auction house, publisher and so on, and to understand just how ill-equipped current antitrust law was to deal with such a multi-faceted entity......a Columbia Law Review paper out in May 2019 will explores the case for separating the ownership of technology platforms from the commercial activity they host, so that Big Tech firms cannot both run a dominant marketplace and compete on it. via a host of old cases — from railroad antitrust suits to the separation of merchant banking and the ownership of commodities — to argue that “if you are a form of infrastructure, then you shouldn’t be able to compete with all the businesses dependent on your infrastructure”....“The new Brandeis movement isn’t just about antitrust,” .... Rather, it is about values. “Laws reflect values,” she says. “Antitrust laws used to reflect one set of values, and then there was a change in values that led us to a very different place.”

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21st._century  Amazon  antitrust  Big_Tech  digital_economy  financial_crises  FTC  lawyers  Lina_Khan  monopolies  multifaceted  paradoxes  platforms  policymakers  predatory_practices  Rana_Foroohar  regulators  Robert_Bork  Tim_Wu  wunderkind  Yale  values  value_judgements 
march 2019 by jerryking
Meg Whitman: ‘Businesses need to think, who’s coming to kill me?’
January 18, 2019 | Financial Times | by Rana Foroohar 7 HOURS AGO.

Whitman has just launched Quibi, a $1bn start-up of which she is chief executive (entertainment mogul Jeffrey Katzenberg, her co-founder, is chairman). The venture, backed by a host of entertainment, tech and finance groups including 21st Century Fox, Viacom, Alibaba, Goldman Sachs and JPMorgan, has the lofty aim of becoming the Netflix of the mobile generation, offering high-quality, bite-sized video content for millennials (and the rest of us) hooked on smartphones......Whitman's experience has left her with plenty of advice for chief executives struggling with nearly every kind of disruption — technological, cultural and geopolitical. “I think every big business needs to be thinking, ‘Who’s coming to kill me?’ Where are the big markets that for regulatory reasons, or just because things are being done the way they always have been, disruption is likely? I’d say healthcare is one,” ...... a “Quibi”, is the new company’s “snackable” videos, designed to be consumed in increments of a few minutes....“You have all these in-between moments, and that’s what inspired the length of the content,” she says. “Very few people are watching long-form content on this device,” she says, holding up her iPhone. “They’re spending four to five hours a day on their phones, but they’re playing games, watching YouTube videos, checking social media, and surfing the internet. And although [people] pick up their phones hundreds of times a day, the average session length is 6.5 minutes.”.......Whitman’s hope is that just as people now binge on hour-long episodes of The Crown or House of Cards at home, they’ll do the same on their smartphone while in the doctor’s office, or commuting, or waiting for a meeting to start. As Whitman puts it, “every day you walk around with a little television in your pocket.” She and Katzenberg are betting that by the end of this year, we’ll spend some of our “in-between moments” watching micro-instalments of mobile movies produced by Oscar winning film-makers or stars ... interviewing other stars. ....The wind was at her back at eBay, where she became president and chief executive in 1998, presiding over a decade in which the company’s annual revenues grew from $4m to $8bn. “It’s hard to change consumer behaviour. We did that at eBay. We taught people how to buy in any auction format on the internet, how to send money 3,000 miles across the country and hope that you got the product.”

Quibi, she believes, doesn’t require that shift. “People are already watching a lot of videos on their phones. You just need to create a different experience.” She lays out how the company will optimise video for phones in ways that (she claims) will utterly change the viewing experience, and will leverage Katzenberg’s 40 years in the business.

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paranoia  CEOs  disruption  Meg_Whitman  Rana_Foroohar  start_ups  women  bite-sized  Hollywood  Jeffrey_Katzenberg  mobile  subscriptions  web_video  high-quality  smartphones  advice  large_companies  large_markets  interstitial  Quibi 
january 2019 by jerryking
The Curse of Bigness by Timothy Wu — why size matters
NOVEMBER 15, 2018 | Financial Times | by Rana Foroohar
The Curse of Bigness: Antitrust in the New Gilded Age, by Timothy Wu, Columbia Global Reports, RRP$14.99, 170 pages.

The hero of the book is Louis Brandeis, the advocate, reformer and Supreme Court Justice who grew up around the mid-to-late 1800s in Louisville, a diverse and decentralised mid-sized American town that Brandeis praised as “idyllic” and free from the “curse of bigness”...... It was a place where small farmers, retailers, professionals and manufacturers all knew each other, worked together, and had the sort of shared moral framework that Adam Smith believed was a key to well-functioning markets.

But by the time Brandeis himself became a lawyer in Boston, oligarchs such as John D Rockefeller and JP Morgan were building empires more powerful than governments (indeed, they often had paid politicians in their pockets — President William McKinley actually acknowledged that Wall Street rather than Washington had control over the economy). Their growing ventures — like Morgan’s railroad monopoly or Rockefeller’s oil dynasty — were neither moral nor even efficient. But the tycoons ....had bought the legislatures, and there was no one powerful enough to reel them in. Brandeis took them on, via a case against Morgan’s New Haven Railway, and exposed the underside of monopoly power — cartel pricing, bribes to officials, accounting fraud and so on....Brandeis believed giant corporations tended to rob people of their humanity....This approach, which was brought into the mainstream by conflicted trust buster Teddy Roosevelt (who both loved and loathed power, but wanted to see corporations curbed by government) lasted through the 1960s. But with the rise of conservative Chicago School academics, in particular Robert Bork, the federal justice who turned the “consumer welfare” ideology of his mentor Aaron Director into a new antitrust philosophy with his book The Antitrust Paradox in 1978, the notion that too much corporate power alone was problematic was abandoned. Antitrust become technocratic and weak, pegged to the idea that as long as companies reduced prices for consumers, they could be as big as they wanted.

That has, of course, allowed any number of industries, from airlines to media to pharmaceuticals, to reach unprecedented levels of concentration.
antitrust  books  book_reviews  Chicago_School  corporate_concentration  FAANG  Rana_Foroohar  Robert_Bork  Tim_Wu 
december 2018 by jerryking
Platform companies have to learn to share
August 19, 2018 | Financial Times | Rana Foroohar.

Algorithmic management places dramatically more power in the hands of platform companies. Not only can they monitor workers 24/7, they benefit from enormous information asymmetries that allow them to suddenly deactivate drivers with low user ratings, or take a higher profit margin from riders willing to pay more for speedier service, without giving drivers a cut. This is not a properly functioning market. It is a data-driven oligopoly that will further shift power from labour to capital at a scale we have never seen before......Rather than wait for more regulatory pushback, platform tech companies should take responsibility now for the changes they have wreaked — and not just the positive ones. That requires an attitude adjustment. Many tech titans have a libertarian bent that makes them dismissive of the public sector as a whole.......Yet the potential benefits of ride-hailing and sharing — from less traffic to less pollution — cannot actually be realised unless the tech companies work with the public sector. One can imagine companies like Uber co-operating with city officials to phase in vehicles slowly, rolling out in underserved areas first, rather than flooding the most congested markets and creating a race to the bottom......Airbnb...often touts its ability to open up new neighbourhoods to tourism, but research shows that in cities like New York, most of its business is done in a handful of high end areas — and the largest chunk by commercial operators with multiple listings, with the effect of raising rents and increasing the strains caused by gentrification. On the labour side, too, the platform companies must take responsibility for the human cost of disruption. NYU professor Arun Sundararajan, has proposed allowing companies to create a “safe harbour” training fund that provides benefits and insurance for drivers and other on-demand workers without triggering labour laws that would categorise such workers as full-time employees (which is what companies want to avoid).
Airbnb  algorithms  dark_side  data_driven  gig_economy  information_asymmetry  New_York_City  oligopolies  on-demand  platforms  public_sector  Rana_Foroohar  ride_sharing  sharing_economy  safe_harbour  training  Uber 
august 2018 by jerryking
Globalised business is a US security issue | Financial Times
Rana Foroohar YESTERDAY

there is a much broader group of people in both the public and the private sector who would like to reverse the economic integration of China and the US for strategic reasons..... a two-day event sponsored late last month by the National Defense University, which brings together military and civilian leaders to discuss the big challenges of the day. Dozens of experts, government officials, and business leaders gathered to talk about the decline in the post-second world war order, the rise of China, and how the US could strengthen its manufacturing and defence industries. The goal would be to create resilient supply chains that could withstand not just a trade war, but an actual war......“If you accept as your starting point that we are in a great power struggle [with China and Russia], then you have to think about securing the innovation base, making viable the industrial base, and scaling it all,”....Included on the event’s reading list was Freedom’s Forge, which outlines the role that US business — notably carmakers — played in gearing up the US for war in the early 1940s. At that time, because of the depth and breadth of the auto industry’s manufacturing and logistical might, the sector was viewed as being just as important to national security as steel and aluminium.

That is not to say the US security community is pro-tariffs or trade war .... But there is a growing group of thoughtful people who believe that American national security interests will require a forcible untangling of the investment and supply chain links between the US and China. They point to high-tech areas like artificial intelligence, robotics, autonomous vehicles, virtual reality, financial technology and biotech as important not only to the military but also for private sector growth.....While America’s military is still figuring out how make sure its supply chains are not controlled by strategic adversaries, the Chinese have played a much more sophisticated long game. The difference can be summed up in two words: industrial policy. China has one. The US doesn’t. The US has always steered away from a formal policy because critics see it as the government “picking winners”. But the Chinese don’t so much pick winners as use a co-ordinated approach to harnessing the technologies they need. They do it not only through investments and acquisitions but also through forced joint ventures, industrial espionage, and cybertheft [jk: predatory practices].....many multinationals were shortening their supply chains even before the current trade conflicts.

It is a trend that will probably speed up. Multinational companies, much more than domestically focused ones, will suffer collateral damage from tariffs. They will also be a major target of Chinese backlash. Anecdotally, this is already leading some groups to shift production from China to other countries, like Vietnam. If the military-industrial complex in the US has its way, those supply chains might move even closer to home.
adversaries  anecdotal  automotive_industry  books  China  China_rising  collateral_damage  co-ordinated_approaches  cybertheft  economic_integration  industrial_espionage  industrial_policies  military-industrial_complex  multinationals  predatory_practices  Rana_Foroohar  WWII  security_&_intelligence  supply_chains  trade_wars  U.S.  U.S.-China_relations 
july 2018 by jerryking
US and China must find ways to control their elites | Financial Times
July 1, 2018 | FT| Rana Foroohar. Pinboard saved article/artifact #25,000

Success rests on heading off popular unrest, rather than winning trade fights.
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Tension between the US and China is driving much of what is happening in the markets today. The analysis has focused on tariffs, currency manipulation, strategic technologies and which country has the most to win or lose in a trade war.

But there is a more important question to be asked when thinking about the future success and stability of each nation: which country will be better able to control its moneyed elites?

In his 1982 work The Rise and Decline of Nations, the economist Mancur Olson argues that civilisations tend to decline when the moneyed interests take over politics. That has clearly happened in both countries, where the levels of wealth inequality are not dissimilar; the top 1 per cent in China own about 30 per cent of the economy; in the US, the figure is 42 per cent.

........Chinese leaders also believe that America’s inability to curb its own elites will be the country’s downfall [Achilles’ heel]....America’s elite business class has, for decades now, sought to distract from rising oligopoly with hypocrisy. US companies complain vociferously about unfair Chinese trade practices and intellectual property theft.
U.S.  China  elitism  Rana_Foroohar  societal_collapse  the_One_Percent  self-interest  books  economists  Mancur_Olson  entrenched_interests  Achilles’_heel  Xi_Jinping  corruption  Chinese_Communist_Party  conflicts  confrontations  U.S.-China_relations 
july 2018 by jerryking
The decline of America’s middle classes | Financial Times
Squeezed: Why Our Families Can’t Afford America, by Alissa Quart, Ecco $27.99, 308 pages

Rana Foroohar is the FT’s global business columnist.

the globalised, computerised, “always on” business world in which 40 per cent of Americans work non-traditional schedules driven by algorithmic efficiency. It’s just one of the challenges for a new class of Americans that Quart dubs the “Middle Precariat.” These people, who range from professors to nurses to caregivers to lawyers, aren’t destitute — they have some means, a degree or two, and have made decent life choices. And yet, they are struggling to stay ahead in an economy in which technology is exerting a deflationary effect on everything (including wages) except the things that create a middle-class life — namely affordable housing, education, healthcare and children.
affordable_housing  books  book_reviews  deflation  downward_mobility  middle_class  on-demand  precarious  Rana_Foroohar 
june 2018 by jerryking
Investors should bet on smaller nimbler companies and countries
March 25, 2018 | FT | Rana Foroohar.

The assets that seem undervalued and safer are all smaller things. Southeast Asian “countries, as well as Southern Europe and parts of Latin America have lots of slack relative in particular to the US, but also core Europe and even China”, says Jay Pelosky, head of the investment advisory firm Pelosky Global Strategies. “They have more room for growth, profit expansion, investment, and a lot more political breathing space.”....Meanwhile, if the US and China really do end up engaging in a full-blown trade war, it may be the smaller Southeast Asian nations that will benefit, since they will continue to be open for business with both. The Association of South East Asian Nations could become an alternative supply chain and preferred trading partner for either region......It may be that Big Tech companies, like big banks, have simply become too sprawling for their own good. Smaller, more localised players will probably also avoid the worst effects of tariffs......Aside from being a less visible target for protectionism, small firms with lower debt levels are better positioned to cope with rising interest rates. Research group Strategas notes that small-cap stocks are the only asset class that has outperformed inflation in every decade from the 1930s onwards. 
investors  Rana_Foroohar  nimbleness  small_cap  ASEAN  asset_classes  supply_chains  Big_Tech 
march 2018 by jerryking
‘Splinternet’ to herald a trade war for the ages
Rana Foroohar | FT| March 5, 2018.

Steel and aluminium tariffs announced by President Trump have, of course, sucked up all the attention in recent days....but the bigger fight will likely be over intellectual property, and who gets what slice of that pie in the coming years. Most corporate wealth is now held in the top 10 per cent of IP rich companies, most of which sit on the West Coast of the US......China, however, is gaining ground in key areas like AI and quantum computing, and has also ringfenced most of the tech sector as a “strategically important” area in which domestic companies are given preference......A more interesting question is whether data and technology will become the subject of broader national defence-related protectionism. In many ways you could make a much easier case for section 232, the “national defence” clause that Mr Trump invoked around steel, in technology. The steel sector in the US has plenty of spare capacity and section 232 also stipulates that national allies could fill any gap, something which the president seems to have overlooked. Technology, meanwhile, is much more proprietary and sensitive — not to mention crucial for every industry and every part of national security.

A tech-based trade war would likely splinter the US, China and Europe into three separate regions. The EU is already going in a very different direction to the US in terms of regulation of the high tech sector, with more stringent privacy rules and limits on how much data can be used by companies for AI, and in what fashion.....Such a Balkanisation, which experts now refer to as “the Splinternet”, would change the functioning of the internet as we know it. It would also represent a trade battle for the ages.
China  crossborder  decoupling  digital_economy  FAANG  intellectual_property  international_trade  NAFTA  new_tech_Cold_War  privacy  protectionism  Rana_Foroohar  tariffs  trade_wars 
march 2018 by jerryking
A Reading List of Tell-Alls, Strategic Plans and Cautionary Tales in Finance - The New York Times
JULY 4, 2016 | DEALBOOK | Andrew Ross Sorkin

(1) “Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley,” by a former Facebook executive, Antonio García Martinez.
(2) “The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse” by Mohamed A. El-Erian, chief economic adviser at Allianz and chairman of President Obama’s Global Development Council.
(3) “Makers and Takers: The Rise of Finance and the Fall of American Business” Rana Foroohar
(4) “Originals: How Non-Conformists Move the World” Adam Grant
(5) Bloodsport: When Ruthless Dealmakers, Shrewd Ideologues, and Brawling Lawyers Toppled the Corporate Establishment” by Robert Teitelman,
(6) “Dear Chairman: Boardroom Battles and the Rise of Shareholder Activism,” by Jeff Gramm, owner and manager of the Bandera Partners hedge fund and an adjunct professor at Columbia Business School.
(7) “Brazillionaires: Wealth, Power, Decadence, and Hope in an American Country” by the journalist Alex Cuadros.
(8) a biography of Alan Greenspan titled, “The Man Who Knew: The Life and Times of Alan Greenspan.” It is by the journalist Sebastian Mallaby, an adroit writer who also published a brilliant book on hedge funds several years ago, called “More Money than God: Hedge Funds and the Making of a New Elite.”
(9) “To Pixar and Beyond: My Unlikely Journey with Steve Jobs to Make Entertainment History” by Lawrence Levy, the former chief financial officer of Pixar.
Rana_Foroohar  books  booklists  summertime  Andrew_Sorkin  Pixar  Mohamed_El-Erian  hedge_funds  central_banks  finance  dealmakers  Silicon_Valley  Brazil  biographies  Adam_Grant  cautionary_tales 
july 2016 by jerryking
At Davos, Leaders are Debating Whether Corporations are More Powerful Than Governments
January 27, 2012 | TIME.com | By Rana Foroohar.

The top companies seem to exist in a world apart — they are booming, and their executives are prospering. If there is a meta theme to this year’s World Economic Forum in Davos, it is that the world’s largest companies are moving on and moving ahead of governments and countries that they perceive to be inept and anemic. They are flying above them, operating in a space that is increasingly disconnected from local concerns, and the problems of their home markets. And if the conversations here are any indication, they may soon take over much of what government itself does....The problem was nicely captured in this week’s New York Times piece on Apple, looking at why the iPhone is mostly made outside America. As one of the company’s executives put it, “We don’t have an obligation to solve America’s problems.” It’s a sentiment that was echoed on Time’s Board of Economists’ panel, where business leaders blamed for not sharing the $2 trillion in wealth sitting on corporate balance sheets argued that they did create jobs and prosperity — just not in this country.....Labor economist Clyde Prestowitz pointed out as much in an article in Foreign Policy this week where he noted that while Apple may not think American economic issues are it’s “problem,” it certainly depends on the Seventh Fleet to keep Asian waterways safe and clear so that it can deliver it’s products.....A lot of people here in Davos — people like Nobel laureate Chris Pissarides, and a number of high level investors I spoke with — say that we can’t innovate or educate our way out of this problem. It’s only going to get worse, particularly as a coming automation revolution starts to hollow out white collar jobs in rich countries.
Rana_Foroohar  Davos  multinationals  Apple  globalization  cash_reserves  job_destruction  job_displacement  downward_mobility  automation  hollowing_out  white-collar  developed_countries  Nobel_Prizes  large_companies  statelessness 
august 2012 by jerryking

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