Philippa Kaur

THE PANDEMIC has been tough for parents of young children. With schools shut, many had to keep an eye on their offspring while juggling chores and remote work. Succour came courtesy of Hollywood. A study by Parrot Analytics, a data firm, found that demand for children’s shows in America—measured by video views, social-media mentions, searches on IMDB, a platform for film buffs, and the like—grew by nearly 60% from the start of 2020, before covid-19 hit, to last September (see chart). Demand for other genres rose by 23% in that period.At the same time, parental concerns about their progeny’s media diets have grown. A recent Pew survey found nearly half of parents saying that YouTube, the most popular destination for young audiences, exposed their children to inappropriate content. Many are chary of social-media apps such as TikTok, one-third of whose users may be under the age of 14, according to internal data seen by the New York Times.Fortunately, help is at hand. Disney, arguably the child-friendliest brand of all, has created a new role tasked with seeking out external children’s programming—part of a reorganisation to separate content creation from merchandising. Paramount+ is promoting its Nickelodeon trove to parents. Its own parent, Viacom CBS, is reportedly in talks to buy the “Alvin and the Chipmunks” franchise from its creators for as much as $300m.In September Netflix paid more than $700m for the Roald Dahl Story Company, which owns the rights to the eponymous author’s beloved tales such as “Charlie and the Chocolate Factory”. In November it announced the launch of Kids Clips, which offers curated short videos from its expanding slate of children’s programmes. Last autumn HBO Max, best-known for edgy grown-up fare, launched Cartoonito, a portal dedicated to pre-school shows.Upstarts are getting in on the action, too. Kidoodle. TV, an ad-supported app that specialises in children’s shows, has seen its downloads balloon during the pandemic. In November two former Disney executives agreed to pay $3bn for Moonbug Entertainment, the company behind hit programmes like “Cocomelon” and “Blippi”.Youth programming is attractive to streaming services for several reasons. Children’s television shows, especially animated ones, often cost less to produce than entertainment for adults, observes Erin Meyers of Oakland University. They tend to have a longer shelf life, too, since young children are less fussy than older viewers about what is hip at any given moment. And children’s programming offers vast merchandising opportunities in the form of toys. Most important, if you get it right you may be rewarded twice over: with current custom from grateful parents and, if their offspring like what they see, a guaranteed stream of future viewers. ■This article appeared in the Business section of the print edition under the headline “No child’s play” More

IN AN EPISODE of “Seinfeld”, a vintage TV sitcom, the character of George Costanza reveals the secret of pretending to work: act irritated. He shakes his head, frowns and sighs to demonstrate the technique. “When you look annoyed all the time, people think that you’re busy.” In comments posted below this clip on YouTube, visitors report with delight that the tactic really does work and offer a few tips of their own: walk around the office carrying manila envelopes, advises one.Before the pandemic turned everyone into remote employees, managers worried that working from home would be a paradise for slackers like George. People would be out of sight and out of mind: starting late, clocking off early and doing nothing in between. The reality of remote working has turned out to be different. Days have become longer and employees are demonstratively visible. Work has become more performative.The simple act of logging on is now public. Green dots by your name on messaging channels are the virtual equivalents of jackets left on chairs and monitors turned on. Calendars are now frequently shared: empty ones look lazy; full ones appear virtuous.Communication is more likely to happen on open messaging channels, where everyone can see who is contributing and who is not. Emails can be performative, too—scheduled for the early morning or the weekend, or the early morning on the weekend, to convey Stakhanovite effort. Repeated noises like Slack’s knock-brush provide a soundtrack of busyness.Meetings, the office’s answer to the theatre, have proliferated. They are harder to avoid now that invitations must be responded to and diaries are public. Even if you don’t say anything, cameras make meetings into a miming performance: an attentive expression and occasional nodding now count as a form of work. The chat function is a new way to project yourself. Satya Nadella, the boss of Microsoft, says that comments in chat help him to meet colleagues he would not otherwise hear from. Maybe so, but that is an irresistible incentive to pose questions that do not need answering and offer observations that are not worth making.Shared documents and messaging channels are also playgrounds of performativity. Colleagues can leave public comments in documents, and in the process notify their authors that something approximating work has been done. They can start new channels and invite anyone in; when no one uses them, they can archive them again and appear efficient. By assigning tasks to people or tagging them in a conversation, they can cast long shadows of faux-industriousness. It is telling that one recent research study found that members of high-performing teams are more likely to speak to each other on the phone, the very opposite of public communication.Performative celebration is another hallmark of the pandemic. Once one person has reacted to a message with a clapping emoji, others are likely to join in until a virtual ovation is under way. At least emojis are fun. The arrival of a round-robin email announcing a promotion is as welcome as a rifle shot in an avalanche zone. Someone responds with congratulations, and then another recipient adds their own well wishes. As more people pile in, pressure builds on the non-responders to reply as well. Within minutes colleagues are telling someone they have never met in person how richly they deserve their new job.Theatre has always been an important part of the workplace. Open communication is a prerequisite of successful remote working. But the prevalence of performative work is bad news—not just for the George Costanzas of the world, who can no longer truly tune out, but also for employees who have to catch up on actual tasks once the show is over. By extension it is also bad for productivity. Why, then, does it persist?One answer lies in the natural desire of employees to demonstrate how hard they are working, like bowerbirds with a keyboard. Another lies in managers’ need to see what everyone is up to. And a third is hinted at in recent research, from academics at two French business schools, which found that white-collar professionals are drawn to a level of “optimal busyness”, which neither overwhelms them nor leaves them with much time to think. Rushing from meeting to meeting, triaging emails and hitting a succession of small deadlines can deliver a buzz, even if nothing much is actually being achieved. The performance is what counts.For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter.This article appeared in the Business section of the print edition under the headline “Office theatrics” More

RESTAURANT AND hotel bosses have had a tough year. Some 700,000 hospitality workers threw in the towel on average each month in the past year. Bars, cafés and eateries are 1.3m workers short relative to the 16.9m employed before covid-19. On January 4th the Bureau of Labour Statistics reported that a record 4.5m Americans quit their jobs in November, 9% up on a month earlier. The quit rate in leisure and hospitality jumped by a percentage point, to 6.4%. Uncertainty from the Omicron variant may make matters worse: as cases surged in December, restaurant footfall fell sharply, according to OpenTable, an online booking website.As in other industries, workers in hospitality are leaving for various reasons, from fear of infection to better opportunities elsewhere. But one big motive is burnout. Psychological exhaustion is more often associated with hard-charging investment bankers and other professionals. Amid the pandemic it has afflicted many blue-collar workers, too.Surveys find that chronic stress is a growing concern across the labour market, but dissatisfaction is especially high in service roles, where hybrid work is not possible. Data collected by Glassdoor, an employment portal, found that employees rate the hospitality sector as one of the worst for work-life balance. Mentions of “burnout” in reviews of employers on the site have doubled during the pandemic. Workers report that new tasks such as dealing with angry customers and enforcing health mandates have added to the burden.Work in restaurants and hotels can be physically taxing, poorly paid and unpredictable. Unlike white-collar workers, who suffer from needing to be constantly available, service workers burn out as a result of uncertain schedules and a lack of control over time, says Ashley Whillans of Harvard Business School. Ian Cook of Visier, a human-resources-analytics firm, says that time off during lockdowns gave employees an opportunity to reflect on their relationship with “fragile and meagrely paid work”.Firms have scrambled to respond. Many food and accommodation businesses have raised wages—by an average of 8.1% year on year in the third quarter, the highest increase on record. That may not be enough. In one poll of hospitality workers, over half said higher pay will not lure them back by itself. Large retailers such as Amazon and Target, which require many of the similar skills, are poaching hospitality staff by offering non-cash perks like subsidised college education, parental leave and career advancement. Most restaurants cannot afford to match such offers.Daniel Zhao, an economist at Glassdoor, foresees a permanent reduction to the hospitality workforce. “High turnover tends to be contagious,” he says, and early resignations can start a vicious cycle. As some workers quit, those who remain must pick up the slack, leading to more stress. This in turn provokes more exits, and so on. Add an ageing population, with dwindling numbers of young people prepared to toil in kitchens or sweep hotel corridors, and hospitality businesses may be contending with blue-collar burnout for years to come. ■For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter.This article appeared in the Business section of the print edition under the headline “Blue-collar burnout” More

SINCE 2008, when General Motors’ then boss delivered a keynote speech at the Consumer Electronics Show (CES), an annual technology jamboree, Las Vegas has offered a glimpse of carmaking’s digital future. This year nearly 200 automotive firms signed up for the event, which got cracking on January 5th. That day GM’s current chief, Mary Barra (pictured), addressed a mostly online, Omicron-avoiding crowd. Like other big carmakers, GM did not show up in person. But Ms Barra’s virtual CES outing signalled how rapidly cars are evolving from oil-filled lumps of metal into devices stuffed with silicon.Ms Barra talked about GM’s transformation from “automaker to platform innovator”, extolled its advances in commercial electric vehicles (EVs) and autonomous driving, and unveiled a battery-powered version of the Chevrolet Silverado pickup. Rival firms raced to appear even more innovative. BMW demonstrated a system that changes a car’s paint colour at the press of a button. Mercedes-Benz went so far as to claim that its Vision EQXX concept, with interior materials fashioned from bamboo, cactus and mushroom, and a battery-powered range of 1,000km, was “reinventing the car”. Not to be outdone, consumer-electronics giants strutted their automotive stuff. Sony, a Japanese one, surprised many attendees when it announced a possible foray into carmaking (though it may merely use the experience to develop EV and self-driving tech to sell to others).Other announcements were less flashy but more telling when it comes to the digitisation of carmaking. Mobileye, the self-driving arm of Intel, which supplies chips to many big car firms, announced expanded deals with Ford, Geely and Volkswagen. Qualcomm, another chipmaker, inked new ones with Volvo, Honda and Renault.The courtship between carmakers and chip firms will only intensify. The worldwide chip shortage that knocked nearly 8m units off global car output is thankfully easing and annualised global car production could return to pre-pandemic levels by the second half of 2022, according to Evercore ISI, an investment bank. Still, car bosses are desperate to avoid a repeat. Many look enviously at Tesla, whose own intimate rapport with semiconductor suppliers buoyed its full-year output for 2021 to a total of 930,000 vehicles. ■For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter.This article appeared in the Business section of the print edition under the headline “Motor Sin City” More

AFTER SEVEN days of deliberation and a flurry of notes to the judge about deadlock, a 12-member jury in Silicon Valley found Elizabeth Holmes, the entrepreneur behind a once promising phlebotomy startup, guilty of four counts of fraudulently deceiving investors. Each count carries a prison term of up to 20 years. She was acquitted of four charges of deceiving patients and doctors; on three others the jury were deadlocked leading to a potential re-trial. The verdict, against which Ms Holmes’s lawyers are expected to appeal, marks the fall of a career that beguiled the media, politicians and many in business.After dropping out of Stanford in 2003 at the age of 19, Ms Holmes had founded Theranos to develop a radical advance in blood-testing technology that she hoped would allow hundreds of tests to be performed using a tiny drop of blood rather than a vial. It was a tantalising vision that promised to make health care more effective and efficient. Unfortunately, Ms Holmes could not bring it to fruition. In voting to convict on four counts, the jury concluded that, aware of her company’s failures, Ms Holmes intentionally lied about its prospects and capabilities, and so crossed the fine line from simple promotion to deliberate fraud—a step she explicitly denied in her public testimony.The verdict will hardly be the end of Ms Holmes. There is sentencing to come, and possibly insights from jurors who sat through more than three months of testimony. And then there will be a tsunami of media, including a planned Hollywood blockbuster. A sentencing date has not yet been set.In a lot of ways Theranos differed little from many startups. It raised upwards of $1bn, reached a high theoretical valuation (in its case $9bn) before crashing without ever going public, disintegrating into a vast graveyard of unfeasible ideas. Usually, executives in these ventures are quickly forgotten but Ms Holmes’s path differed at least in part because even if her company’s products failed, her presence and broader story proved unusually compelling.In building Theranos, Ms Holmes assembled a remarkable collection of acolytes. Her board was filled with several former secretaries of state and defence. Joe Biden, while vice-president, called Theranos “the laboratory of the future” and Ms Holmes “an inspiration”. The company’s shocking failure suggested her famous followers had fed merely on hype. The fashion press was besotted by Ms Holmes’s ability to present herself. The Steve Jobs-inspired black turtlenecks worn while running Theranos were seen as reflecting authority. The open-necked shirts and blouses she wore during the trial were a sign of appealing vulnerability, augmented by the nappy bag she carried to court, which signalled to the jury the cost to a young mother (her child was born last July), were they to convict her and send her away. Reporters and others waited for hours to gain a rare sought-after seat at her trial.Ms Holmes’s defence followed two distinct lines. The most obvious hinged on naivety. She may have been wrong about Theranos’s prospects, the argument went, but that is not a crime. Start-up investors are supposed to be a sophisticated lot, willing to wager based on deep insights in the hope of a big return, while understanding that longshots fail. Surely the doctrine of caveat emptor still exists?Key to the prosecution were the presentations Ms Holmes made to investors, which appeared to exaggerate potential sales and trumpet non-existent endorsements from the armed forces and big pharmaceutical companies. The single substantive request made by the jurors during their deliberation was to rehear a presentation that had been recorded, suggesting they were focused on precisely what she said.Ms Holmes’s second line of argument, the so-called Svengali defence, was particularly appealing to Hollywood, but its impact on the jury was unclear. She claimed at the trial to have been sexually and emotionally abused and manipulated by Ramesh “Sunny” Balwani, her partner and Theranos’s former chief operating officer. If true, was she then even responsible for her actions? And if true, what sort of inspiration was she really?Mr Balwani has strongly denied all allegations. His own trial for fraud charges will begin next month, ensuring the overall case will not end soon. And even after the last gavel is pounded, there will be more to come. In the lead-up to the verdict Hulu, a cable network, released photos from an upcoming mini-series on Ms Holmes’s story, starring Amanda Seyfried. Ms Holmes may be going to jail, but she will not be going away.For more expert analysis of the biggest stories in economics, business and markets, sign up to Money Talks, our weekly newsletter. More

SMARTPHONES ABLE to take advantage of zippy fifth-generation (5G) mobile networks have graced American pockets for nearly three years. Samsung launched its first 5G-enabled device in April 2019. Apple followed suit in late 2020 with its long-awaited 5G iPhone. Until now, however, opportunities actually to connect to 5G networks in America have been limited. Only one of America’s three biggest carriers, T-mobile, has offered broad 5G connectivity. AT&T and Verizon, its two bigger rivals, have had to delay their large-scale roll-outs, most recently in December after the Federal Aviation Administration aired concerns that their 5G radio spectrum interferes with avionics on some ageing aircraft. On January 2nd both firms, which insist that the technology is safe (and can be turned off around airports, just in case), said they would at last switch on their 5G networks this week.Yet it is the arrival of another player in the 5G contest that is the talk of the industry. In the next few months Dish Networks, a firm best known for its satellite-television service, is expected to launch America’s fourth big carrier. The company’s promise to inject more competition into a concentrated and ossified industry was what helped convince regulators to approve a merger between T-mobile and Sprint, a smaller incumbent, in 2020.More important, Dish’s network is to be the first in America that would live almost entirely in a computing cloud. Except for antennas and cables, it is mostly a cluster of code that runs on Amazon Web Services (AWS), the e-commerce giant’s cloud-computing arm. As such, the roll-out is a test of the extent to which computing clouds will “eat” the telecoms industry, as software has eaten everything from taxis to Tinseltown. If the launch is a success and other carriers follow suit, it could reconfigure not just America’s wireless industry but the global mobile-telecoms market with annual revenues of around $1trn, according to Dell’Oro Group, a research firm. And it would entangle telecoms intimately with the cloud business, whose revenues could be half as large this year and are growing at double digits.Dish’s network is the culmination of a process that started in the early 1980s, when antitrust regulators allowed AT&T, the world’s largest network operator, and IBM, its biggest computer firm, to enter each others’ markets. AT&T started selling personal computers and IBM bought ROLM, which sold telecoms equipment. Pundits predicted an epic battle between the two giants—and a rapid convergence of the telecoms and computer industries into one.Neither the battle nor the convergence materialised. Forty years ago the two markets proved too distinct and the technology was not up to snuff. Now things look different. Computing clouds such as AWS and Microsoft’s Azure are maturing fast, and finally becoming able to deal with the demanding task of powering a mobile network. The latest iteration of mobile technology, 5G, was conceived from the start not as a collection of switches and other hardware, but as a set of services that can be turned into software, or “virtualised”. And the telecoms industry is becoming less proprietary, embracing “open radio access network” (O-RAN) standards that make it possible to virtualise ever more functions previously performed by hardware. As a result, networks can turn into platforms for software add-ons, just as mobiles turned into smartphones which could run apps.All this will be on full display in Dish’s network. Instead of bulky base stations used in conventional mobile networks, its technology is housed in slender boxes attached to antenna posts. These are connected directly to the AWS cloud, which hosts the virtual part of the network, including all of Dish’s other software (for example that used to manage subscribers and billing). The only thing the company is buying from established makers of telecoms gear is software, says Marc Rouanne, Dish’s chief network officer (who used to work for one such vendor, Finland’s Nokia).As a result, Dish’s network will be cheaper to set up and to run. It will also be fully automated, down to the virtual “labs” where new services are tested. This should allow the company quickly to spin up special-purpose networks, for instance connecting equipment in mine shafts, or enabling drones to talk to each other and their controllers. Dish also wants to use artificial intelligence to optimise the use of radio spectrum, including by training algorithms which are able to adapt parts of the network to specific conditions such as a storm or a mass concert.Although Dish is pushing this “cloudification” furthest, other carriers around the world are not far behind. In June AT&T, still America’s largest mobile operator, sold the technology that powers the core of its 5G network to Microsoft, which will run it for AT&T on its Azure cloud. Reliance Jio, India’s technology titan, has ambitious plans to build a cloud-based 5G network.These developments are also bringing the big cloud providers into the telecoms world. Last year Microsoft bought Affirmed Networks and Metaswitch, the main software suppliers for the core of AT&T’s 5G network. They now form a new business unit called “Azure for Operators”. Google has a similar effort and recently formed a partnership with Telenor, a Norwegian telecoms company. In November AWS announced a new offering that lets customers quickly set up private 5G networks on their premises.Newcomers are also elbowing their way into the business. Rakuten, a Japanese online giant, has already built a Dish-like network at home. Rather than outsourcing its cloud operation to big tech, Rakuten has built its own, and launched a subsidiary, called Rakuten Symphony, to offer the system to other operators. It is helping 1&1, a German web-hosting company, to build a network. “We don’t want to be a telco cloud, but enable operators to make their own,” explains Tareq Amin, who heads Rakuten Symphony.Existing mobile networks will not be replaced overnight. Rakuten’s network faced delays and Dish’s was originally scheduled for launch late last year. Some technical barriers remain. Despite being seen as a welcome alternative to gear from Huawei, a controversial Chinese giant, especially in Europe, gear based on O-RAN specifications is not mature. Its European adopters have therefore yet to install it in the most vital parts of their networks. “It’s in an extended beta test,” sums up Dean Bubley of Disruptive Analysis, a consultancy.Another question is whether the cloud can completely gobble up telecoms networks, notes Stéphane Téral of LightCounting, another consultancy. Controlling a 5G base station is hugely complex and involves keeping tabs on hundreds of parameters. The more flexible a carrier wants to be, the more complicated things get. At least for some time, the necessary control software may need to run on specialised gear near the antenna rather than on generalist servers in faraway data centres.Then there are the political and financial barriers. European governments fret that America’s spooks will have even more access to their country’s networks if these run in American clouds (Europe has none of its own and is understandably even warier of Chinese ones). Carriers, in Europe and elsewhere, fear losing business to the tech giants like Amazon, Google or Microsoft, which have already skimmed most of the value generated by 4G mobile technology. “If all this is not financially interesting for [telecoms firms], they will try something else,” says Michael Trabbia, chief technology officer of Orange, a French mobile operator.However all this plays out, the telecoms business will look very different a few years from now. The contest for control of the telecoms cloud, and particularly its “edge” (tech speak for what remains of the base station) will only heat up. Whoever is in charge of these digital gates will have the fastest access to consumers and their data, the main currency in a world of new wireless services, from self-driving cars to virtual-reality metaverses.The cloud businesses have the technological edge for now, and will try to eat as much of wireless networks as possible. The operators have relationships with customers, know how to manage networks and own the requisite radio spectrum. Eventually, cloud providers and network operators will probably come to some kind of agreement. In the new world of mobile telecoms, neither can do without the other. More

As violins play mournfully, Jon Stewart, an American comic, makes a mock-emotional appeal to viewers. “Every year thousands of hours of high-quality content go unwatched,” he says seriously. “Because good, hard-working people…don’t know how to find Apple TV+.”The world’s most valuable company can afford a few jokes at its own expense. In the past year the tech colossus has raked in $366bn in revenue, a third more than in 2020. It is on track to become the first firm with a market capitalisation of $3trn (see chart 1). The mere billions that it is investing in media, including a new television show hosted by Mr Stewart, represent pocket change to the Silicon Valley giant.Yet some 300 miles (480km) away in Hollywood, where executives used to snigger about the dilettantes from big-tech land up north, Apple’s dabbling in media is no joke. Though it lags well behind Netflix and the like, Apple has enough money to ride out the increasingly expensive streaming wars, which threaten to bankrupt other players. One question keeps its rivals awake at night: just how big in media does Apple want to be?Apple became a big noise in music when it launched iTunes almost exactly 21 years ago. It took a cut of songs’ sales, and shifted hundreds of millions of iPods for people to play them. Later iTunes sold movies, too, and the firm hoped to make the same model work in television, where the market is an order of magnitude larger than music. But paying for downloads was superseded by all-you-can-eat subscriptions, pioneered by Spotify in music and Netflix in TV. Unlike downloaded music or films, subscriptions could be easily transferred between platforms. So Apple, seeing little opportunity to lock consumers into its devices, sat out the streaming revolution.Today it is back in the media game, and a bigger force than Mr Stewart’s joke implies (see chart 2). Apple Music, launched in 2015, is the second-largest streamer after Spotify. Apple TV+, now two years old, is the fourth-largest video service outside China by the number of subscribers, according to Omdia, a data company. In the past couple of years Apple has made smaller media bets including Arcade, a subscription gaming package, News+, a publishing bundle, and Fitness+, which offers video aerobics classes. There is talk of an audiobooks service later this year.Like Amazon, another tech giant with a sideline in media, Apple has been able to roll out its offerings more quickly in more countries than most of its Hollywood rivals, which have had to build direct-to-consumer businesses from scratch. And it can afford to be generous with free trials: less than a third of Apple TV+ subscribers pay for the service, Omdia believes. It has had some hits, notably “Ted Lasso”, which won a string of Emmy awards in September. But it lacks a back-catalogue, leading to high rates of customer churn. Smaller competitors like Paramount+ (part of ViacomCBS) and Peacock (from NBCUniversal) have limited new offerings but decades-old libraries.Old-media firms have been puzzled by Apple’s on-off sorties into their territory, which sometimes seem half-hearted. Winning at streaming depends mainly on splurging on content. But deep-pocketed Apple spent just over $2bn on film and tv in 2021, against Amazon’s $9bn and Netflix’s $14bn, estimates Ampere Analysis, a research company. It doesn’t bother to market its efforts much. And although medialand has cooed at the executives that Apple has poached, such as Jamie Erlicht and Zack Van Amburg from Sony and Richard Plepler from HBO, Silicon Valley insiders say that Apple keeps its own top tech people on other projects.Indeed, while Hollywood frets about Apple’s next move, many in Silicon Valley wonder why the company is in media at all. None of the markets is a big prize for the world’s most valuable firm. The entire global recorded music industry had sales of $22bn in 2020, less than Apple made just from selling iPads. In about a month Apple generates as much revenue as Netflix makes in a year. Apple’s TV business depends on buying shows, rather than extracting rents from others’ creations as it did in the iTunes days (and as it still does in its app store). And the “lock-in” effect on consumers is weak, since Apple’s main media services are available on all platforms.Apple’s renewed interest in media is best explained by the transformation in the company’s scale, which radically changes the calculation of which side-projects are worthwhile. Fifteen years ago, when Netflix started streaming, the billions involved in running a film studio would have represented close to a double-digit chunk of Apple’s annual revenues. Back then, Silicon Valley executives would fly down to Los Angeles, thinking “We’ve got a big chequebook, we could go and buy a bunch of content,” says Benedict Evans, a tech analyst and former venture capitalist. “And they would go and have their first meeting in LA. And the LA people would tell them the price”—at which point the tech people would go home. In 2021 Apple TV+’s estimated content budget represented 0.6% of company revenues: “play money”, as Mr Evans puts it.The cost of running a studio can therefore be justified by what are only modest benefits to Apple. Streaming subscriptions may not lock people in as strongly as iTunes purchases did, but Apple’s various services still sink “meat hooks” into customers, making them spend more time with their devices and making it a bit more inconvenient to leave Apple’s ecosystem, says Nick Lightle, a former Spotify executive. The iPhone itself, which generated $192bn in sales in the past year, more than half of Apple’s total revenues, is sold as a sort of subscription, points out Mr Evans. Anything that reduces churn among iPhone subscribers by even a small amount is likely to pay for itself.Media also makes good marketing. Producing films with Steven Spielberg and Tom Hanks reinforces Apple’s premium brand. Partnerships with pop stars keep it cool. And at a time when Silicon Valley is under attack for monopolistic practices, invasion of privacy, subversion of democracy and more, Apple is churning out worthy podcasts by Malala Yousafzai, a Nobel laureate, and teaching fitness routines to children. Not many companies can think of a film studio as a public-relations arm. A $3trn company can.“Apple is not playing the same game as many of its other [media] competitors,” says Julia Alexander of Parrot Analytics, another data firm. For one-trick rivals like Netflix, it is an uncomfortably asymmetric competition. Yet Apple’s broader priorities can also hamstring its media ambitions. Apple TV+’s lack of a library could be solved by buying someone else’s; the firm has been touted as a potential buyer of small studios like Lionsgate as well as giant ones like Disney. But Apple may be wary of provoking America’s Federal Trade Commission (FTC), which has its sights on Silicon Valley. “If you’re Apple and the FTC is looking at big tech, the last thing you want to do is make a huge acquisition,” notes Ms Alexander. Lina Khan, the FTC’s tech-bashing head, is examining Amazon’s recent $8.5bn purchase of MGM Studios; never mind that the target is a relative tiddler in a fragmented market. As companies vie for control of tech’s next commanding heights, from decentralised Web3 to virtual reality, attracting the attention of regulators by buying old TV episodes could be a strategic error.For as long as they continue to help sell its devices and burnish its brand, Apple will keep dripping investment into its media services. Doing so will get more expensive: global spending on video content will exceed $230bn in 2022, according to Ampere, nearly double what it was a decade ago. As smaller competitors are outspent and give up, Apple’s position could even strengthen. But given its bigger ambitions in other industries, in media Apple is likely to be content to stick to its role as a supporting actor. More

“RIDICULOUS AND cool.” That is the architectural brief for a new office tower under construction in the Crypto Valley, a business district of Decentraland, a virtual platform built on the Ethereum blockchain. The edifice—owned by Tokens.com, a blockchain investor—will be a cross between a nightclub in Ibiza and the Bellagio resort in Las Vegas. In a fantasy world unencumbered by something as pedestrian as physics, a rotating company logo will float above the tower as nearby clouds shoot out company-branded thunderbolts. The tower’s purpose—to provide office leases for firms and event space for crypto conferences—is humdrum by comparison.Listen to this storyYour browser does not support the element.Enjoy more audio and podcasts on More