UMG Bends the Knee

Audiophile Cocktail Lounges, The TikTok Ban, and much more

UMG Bends the Knee

From WSJ:

Universal Music and TikTok reached a new agreement that will return the world’s largest record company’s music to the platform while broadening artificial intelligence protections.

I’m probably not the first to notice this, but it’s obvious that TikTok won this battle because UMG isn’t gloating about royalty rates, or providing any meaningful details how this financially benefits artists.

Instead, we get corporate word salad from UMG about “AI protections” and “multi-dimensional opportunities” while TikTok pats them on the head and rolls their eyes.

I’m glad these artists will see their music restored on TikTok, but it’s obvious they’ll see very little difference to their bottom line.

For Sale:

Social Media Platform with Awesome Algorithm*

*Algorithm not included

ByteDance is considering selling a majority stake in TikTok's U.S. business to companies outside the tech industry, but it comes with one gigantic catch: The company prefers to sell the stake without transferring the algorithm that recommends videos to TikTok users. 

ByteDance's discussions come as President Biden recently signed into law a requirement that TikTok cut ties with ByteDance within nine to twelve months or face a ban in the US. TikTok plans to challenge the law in court, stating that it infringes on the First Amendment rights of its users, so you can expect that 9-12 month scenario to dramatically increase. 

If ByteDance loses the lawsuit, staffers have considered scenarios for selling TikTok.

One scenario being discussed involves ByteDance selling more than 50% of TikTok U.S. but retaining a minority stake of 20%, as the law limits Chinese ownership to this percentage. 

Given current social media valuations, TikTok as a whole could be worth up to $100 billion. However, the US portion would be worth less, and the forced nature of any sale would likely reduce the price.

ByteDance executives want to do whatever they can to avoid a ban on the app in the U.S., which would curb stomp its global potential as a business. TikTok generated about $20 billion in revenue in '23, mainly from advertising, with the bulk of that coming from the U.S.  

The sale options being discussed wouldn’t include the algorithm that powers TikTok, but it would include the TikTok brand. China would probably block the sale of the algorithm anyway. In 2020, when ByteDance last considered selling TikTok, China changed its export control rules to include technology -- specifically the algorithm.

Suppose it's true that the offers exclude tech companies. In that case, you can forget about Oracle and Microsoft, which both made offers in 2020 when it briefly conducted an auction of TikTok in the face of a threatened ban of the app by then-President Donald Trump -- who, as I previously wrote, now opposes a ban or sale of TikTok.

ByteDance could open the door for Walmart (they're hot with Gen Z, right?!) to acquire TikTok by sticking to its approach in any sale discussions. Walmart was previously involved in a bid with Oracle for TikTok in 2020. However, the steep price of TikTok may pose an issue for many buyers. To reduce the cash cost, ByteDance could spin off TikTok into a new company owned partly by U.S. investors who already own about 60% of ByteDance.

Without its hallowed algorithm, TikTok would be unappealing to many buyers. A purchaser must reconstruct its back-end infrastructure, requiring expensive computing resources. Additionally, ByteDance employs many of the engineers responsible for TikTok's algorithm, which means a buyer would have to compete for machine-learning engineers to staff up appropriately. 

Related: Remember when US tech companies used to build awesome things instead of just acquiring them?

To complicate matters even more, it’s unclear whether China would even allow a sale of any part of TikTok. The Chinese government and state media have criticized the law. China’s Ministry of Commerce said last month that China would “take all necessary measures” to protect its rights and interests in response to a question about the bill, and the country’s state-run English-language newspaper China Daily called it “another attempt at theft on a grand scale.”

Turning Up the Silence

Bar Continental in Nashville, Tenn., boasts vintage Tannoy speakers and thousands of vinyl records.

American Bars Embrace Japan's Audiophile Café Culture

There’s a new trend in American bars: They’re taking inspiration from Japan's jazz cafes and installing high-quality sound systems and acoustics to create a unique music experience for customers. 

These bars, such as Continental in Nashville, Shibuya in Seattle, and Tokyo Listening Room in NYC, offer food and drinks that don't need to be mixed loudly, accompanied by audiophile-quality sonics.

This experience encourages customers to eat and drink in silence while listening to an entire album, creating a unique vibe. 

Although the bars are focused on music, customers can still chat with their friends due to the excellent acoustics that allow for low conversations. 

This trend has become so popular that a Yelp report found that online searches for these bars have increased by 306% in the past year alone, with up to 75 listening bars already open in the US. This trend could also create a new way for artists to launch their new or remastered albums.

Ideas

Tinder Date Accuracy Analytics

IG Forced Unarchive

Uber Open Mic

Instagram Is Going After “Aggregator” Accounts

Bizarre image provided by Instagram

Instagram is changing its algorithm in an effort to “reward original content.”

The way this will work is that posts will go through what they’re calling “multistage exposure,” which, to me, sounds a lot like TikTok’s categories. I don’t use TikTok, so I could be talking out of my ass.

But the biggest part of the Instagram overhaul is that the platform is removing aggregators, which Instagram, in their blog post, defines as “accounts that repeatedly (10 or more times in the last 30 days) post content from other Instagram users that they didn’t create or enhance in a material way.” 

I think the notable thing here, though, is that Instagram is going after recycled Instagram content. It’s not cracking down on photos, screenshots, or videos from other platforms. I assume because if they did there would basically be nothing left for anyone to look at on the app.

I mention this because I have friends who aggregate content, some of whom make more from their anonymous IG account than from their band, sad but true.

Who knows how long it will last, because despite Gen Z and Gen Alpha no longer dreaming about becoming scientists or astronauts, not everyone can be a creator.

We Need Better Political Villians 

Congressman Michael McCaul (R., Texas) purchased $700,000 in Meta stock in the two weeks leading up to his "YES" vote to force ByteDance's divestiture from TikTok. 

Such an action is regarded as insider trading, and it's unacceptable. However, because he purchased the stock after divestiture, the news was already priced in, and he apparently lost over $100K on the purchase. This raises the question of whether it's still insider trading if you're unsuccessful and get roasted on social media for your behavior. 

I still think it is, but who am I?

It's time that the American people demand better political villains. We pay an absurd amount of taxes and deserve sophisticated subterfuge, not transparently idiotic behavior that can be explained in 280 characters on Twitter/X/whatever.

Congressional criminals must strive to do better, and we must hold them accountable for their actions.

THE NEWS DESK

Music, Media, & Entertainment

• Artists have earned $123m via Bandcamp Fridays since 2020; fans have paid artists and their labels $1.3bn via the platform to date.
  Read More → mbw

• The Sundance Film Festival has received interest from San Francisco, Chicago, and some other cities that have no chance to become the influential festival's new home starting in 2027.
  Read More → deadline

• A24 faces backlash for posters from its movie Civil War. The company used AI to generate the images, and the Chicago scene contains some particularly embarrassing errors.
  Read More → thewrap

• SiriusXM reported earnings this week, and while revenue was up 1% quarter over quarter, it also lost 445,000 satellite radio and 64,000 Pandora subscribers.
  Two things: Stern is irrelevant and hasn’t increased subs since 2013; just imagine how big this loss would be without complimentary access in practically every new car.

  Read More → siriusxm

E-Commerce & Retail

• Shopify uses a numerical ranking system where employees compete against each other, Lord of the Flies style, for pay raises.

  Read More → theinformation

• Gen Z is really into lip fillers, Botox, and other physical enhancements after being raised on camera filters.

  Read More → businessinsider

• Amazon may be scaling back its cashier-less “Just Walk Out” tech in its stores, but it’s increasing sales to other retailers. Read More → Bloomberg

• Amazon also announced that it’s rolling out its Q chatbot, capable of performing multi-step complex tasks, widely to the public, so expect integration into its e-commerce store any day now.

  Read More → theinformation

• Caitlin Clark, the No. 1 pick in the WNBA draft, is finalizing an eight-figure endorsement deal with Nike, including a signature shoe.

Tech, Web3, & AI

• Kajabi, a platform that lets creators sell online courses, has launched a product that allows creators to design and launch their own mobile apps. The company said the product is customizable and supports both Apple and Google’s app stores. It also supports features such as push notifications and in-app purchases. The product costs just $89 per month. Insane!
  Read More → kajabi

• A Reuters/Ipsos poll found that 50% of Americans support a TikTok ban, and 46% believe that Beijing does use the platform to spy on US users.
  Read More → variety

• Threads (it’s still a thing?) launched a bonus program for creators in a push to get more Instagram influencers using the platform. 
  Read More → TechCrunch

• Cinematrix, an addictive mix of movie trivia and puzzle solving, is proving to be for Vulture what Wordle is for NYT.
  Play More → cinematrix

• a16z raised an insane $7.2 billion to start its next era of startup investing — this time entirely focused on AI. 

  Read More → ft

• Snap will watermark AI-generated images on its platform with its ghost logo… but only if the image is saved or exported. 
  Read More → engadget

• Federal prosecutors have opened an investigation into Block after it was discovered that Cash App and Square had authorized transactions from sanctioned countries and terrorist groups.
  Read More → nbcnews

Misc.

• A wild male orangutan in Indonesia was observed applying a medicinal paste to a scrape on his face. It's the first documented example of an animal self-medicating a wound using a plant with healing properties. Wow!
  Read More → nature

• The iceberg that sank the Titanic may have been revealed in this newly unearthed photo.
  Read More → petapixel

• TikTok employees entering the U.S. from China have been signaled out at the border and questioned by Customs and Border Protection. Hey, at least we’re stopping someone at the border. Read More → forbes

• Substack will allow creators to paywall their Chat discussions to further monetize their content. I can see people paying not to talk to me, but not the exact opposite.
  Read More → techcrunch

Deep Reads

• The Cloud Under the Sea
  While the internet may appear wireless, it is powered by a vast network of undersea cables. When those physical cables break, a small group of ships is responsible for keeping 99% of the world's data online.
  Read More → verge

• The Giant Salmon With a Weaponized Mustache
  Capable of growing up to nine feet long, the “sabertooth salmon” eclipses even the largest King Salmon, and it’s not even close. As rulers of the river, these salmon sported tusk-like teeth like a weaponized mustache—but biologists are still trying to understand how they wielded them.
  Read More → atlasobscura

• The English Heiress Who Masterminded a Multimillion-Dollar Art Heist and Built Bombs for the IRA
  Fifty years ago, Rose Dugdale stole 19 paintings worth £8 million, including from a British aristocrat’s estate. She also hijacked a helicopter and dropped two makeshift bombs on a police station in Strabane, Northern Ireland.
  Read More → Smithsonian

The Billie Irish