đ˝ Metaâs copycat ad-vantage
Hey Snackers,
David Bowie asked if there was life on Mars. Now we at least know thereâs âorganic matterâ on Mars. NASAâs Perseverance Rover made the big discovery last week. Somehow, âorganic matterâ just isnât as catchy.
US stock indexes rallied last week, led by the techy Nasdaq, which gained over 3%. The Dow had its best week since March after news of cooling inflation and strong bank earnings. Traders gained hope that the Fedâs expected rate hike in July could be its last of the year.
The success of Metaâs Twitter dupe hinges on one-upping the original (Zuck style)
Rethread = the new retweet?⌠Meta's âTwitter killer,â Threads, became the fastest-growing social app ever last week, hitting 100M users within five days of launch. FYI: Twitter had 240M daily scrollers a year ago (the last time it shared #s before Elon Musk bought it). Twitter responded to Threads by saying it would sue Meta, while Musk asked Mark Zuckerberg to up the ante from a cage fight to (ahem) an anatomical-measuring contest.
Nepo baby: Over 3B (yes, billion) users already use Metaâs âfamily of apps,â and Threads was launched with close links to popular older sibling Instagram.
Locked in: Not only do users need an Insta account to sign up, but the only way to delete Threads is to⌠also delete IG.
Anything you can do⌠Meta thinks it can do better â by using its âcopy, acquire, killâ strategy. It snapped up WhatsApp and Insta early, and after failing to buy Snapchat and TikTok (then called Musical.ly), Meta added copycat features like Stories and Reels. But Threads takes mimicry to another level as a standalone app (Zuck even tweeted the âSpider-Man Pointing at Spider-Manâ meme last week â his first tweet in over a decade).
- More cats, less controversy: While Twitter has lost ad $$ over controversial content, an advertiser-friendly approach could clear Threadsâ path to $8B in revenue by 2025. IG head Adam Mosseri said Threads wonât encourage news and politics.
Imitation works only when itâs done better⌠Lookalike features have been a win for Meta as users opt for the convenience of its all-in-one social ecosystem. This year, Zuck said Insta usage had grown 24% since adding Reels. Still, it hasn't killed rivals like TikTok and Snap. Plus, some folks are concerned about giving all their social-networking time (and data) to one mega corp. As Threads adds new features, itâs too early to call whether itâll go the way of Insta or the way of defunct Google+ (which was called a âFacebook killerâ).
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It's called Masterworks. Their nearly $1 billion collection includes works by greats like Banksy, Picasso, and Basquiat, all of which are collectively owned by everyday investors. When Masterworks sells a painting â like the 14 it's already sold â investors reap their portion of the net proceeds.
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Coming up this week
What banking crisis?⌠Big banks kicked off Q2 earnings season on Friday, with JPMorgan Chase, Citi, and Wells Fargo beating estimates. It could be a taste of what Bank of America, Charles Schwab, and Morgan Stanley might report this week. Chase and WF saw profits soar by over 50% as they raked in more interest income on loans thanks to steeper rates (Citi also got a rate boost, but its profit fell). IOU defaults ticked up but are historically low. While âtoo big to failâ banks are looking solid, results might not be as sunny for smaller players.
Rewatching âWednesdayâ... while waiting for Netflix to report Wednesday. Now that Hollywood writers and actors are on strike, the US content-churning machine is on pause. But while Netflixâs Q1 subscriber growth underwhelmed, analysts expect more action from Q2. Netflixâs cheaper ad-based tier has seen 5M+ global sign-ups since November, and the password-mooching crackdown seems to be paying off: since Netflix restricted US account sharing in May, it reportedly notched its four biggest sign-up days on record (thanks, exes).
Stories weâre watching
Captcha-ing fire⌠NYC recently began enforcing a first-of-its-kind AI law, centered on the use of AI in hiring. The law says that employers using the tech must inform candidates and submit to audits showing that their systems are unbiased. From rÊsumÊ screening to initial chatbot interviews, automation has made its way into virtually every part of hiring, and four in five companies use the tech. AI hiring laws are in the works in several states, though experts say federal guidelines will likely be needed.
Ripple effects⌠In what experts called a blow to the SECâs crypto crackdown, a judge ruled that Ripple's XRP token was a security when sold to investors in 2013 but not a security when it was offered for sale to the public. (FYI: the SEC has said most cryptos are securities.) XRPâs market cap soared from $25B to $45B+ after the news last week, and crypto broadly rallied. Exchanges like Coinbase celebrated it as a win, but they risk getting ahead of themselves â the case was about Ripple, not all crypto, and the SEC may appeal.
Last week's highlights
Youth: âLongevity clinicsâ promising to lengthen lifespans of wealthy clients are attracting millions in venture investments. Some charge up to $100K/year to provide treatments like plasma transfusions.
Sweat: This year could be one of the Earthâs hottest ever as dangerous temps bake the Southwestern US. As demand for AC spikes, companies are searching for more energy-efficient cooling solutions.
Copywrong: Comedian Sarah Silverman sued Meta and OpenAI, saying her book was used in training their AI large language models. The copyright-infringement suit says thousands of other scribes could also be plaintiffs.
What else weâre Snackinâ
Therapy: UnitedHealth said more Americans are seeking mental-health care for conditions like anxiety. The insurance giant said its costs are rising as people feel increasingly comfortable seeking help.
Empty: Pricey swivel chairs are being resold or junked as commercial real-estate vacancies soar (the US has ~1B square feet of empty office space). McKinsey found that only 37% of office workers commute daily.
This Week
Monday: Earnings expected from Equity LifeStyle Properties
Tuesday: US retail sales. Earnings expected from Bank of America, BNY Mellon, Charles Schwab, J.B. Hunt, Lockheed Martin, Morgan Stanley, Novartis, Omnicom, and Western Alliance Bank
Wednesday: Earnings expected from Alcoa, Discover, Equifax, First Horizon Bank, Goldman Sachs, IBM, Kinder Morgan, Las Vegas Sands, Nasdaq, Netflix, Tesla, United Airlines, US Bank, and Volvo
Thursday: Earnings expected from Abbott, American Airlines, Blackstone, Capital One, Johnson & Johnson, Kenvue, Nokia, and Philip Morris
Friday: Earnings expected from American Express and Comerica
Authors of this Snacks own shares of Snap and Tesla
*Advertiser Disclosure: See important disclosures at masterworks.com/cd.