- Want to go shopping? Just open up Facebook…
- Once again, the media is jumping the gun
- This company is on the “edge” of a huge tech trend
Dear Reader,
I’ve been waiting for this for almost a decade…
At 4:33 p.m. ET, astronauts Douglas Hurley and Robert Behnken are scheduled to leave Earth from American soil. They’ll be on board the Dragon spacecraft that sits atop SpaceX’s impressive Falcon 9 launch vehicle.
Readers can go here to watch the launch live. Weather permitting, we’ll be able to witness history in the making… the next generation of human spaceflight. Needless to say, I’m grinning from ear to ear… and keeping my fingers crossed for a safe and successful launch.
And while not nearly as dramatic, today I’m going to share another example of how the world is adjusting to a new normal… and experimenting with technology to make that happen.
The legal system has been an absolute mess during the pandemic. Jury trials have been on hold throughout the United States and other countries. For those expecting to be on trial, perhaps this a welcome relief, but legal matters still require attention.
And a district court in Texas decided to take matters into its own hands. It picked a full jury to hear a case entirely by a videoconference. Potential jurors simply logged into a Zoom videoconference call for jury selection.
After the jury is selected, the trial is shortened into a summary jury trial that can be conducted in just one day. Jurors hear a condensed version of the case and deliver a non-binding verdict. After that, both sides sit down to negotiate a settlement.
It’s smart to experiment with technology like this. The reality is that we may be faced with a second fear- and panic-induced lockdown in the fall when COVID-19 returns with the colder, drier weather.
My prediction is that the return of the virus won’t be anywhere near what we experienced in the first wave, but that doesn’t mean the world won’t overreact a second time around.
We’ll be far better prepared in the fall to deal with another lockdown, or partial lockdown. And while the Texas case may represent the first virtual jury, it most certainly won’t be the last.
Now let’s turn to today’s insights…
Facebook’s new move is an attack on Amazon…
Last week, Facebook launched its Shops feature. This is an e-commerce platform that will let third parties set up free storefronts on Facebook and Instagram. Businesses will be able to sell their products right inside the social media applications.
Facebook is positioning this move as an attempt to help small businesses impacted by the COVID-19 lockdown. But really, this is an attack on Amazon. It’s an aggressive push into e-commerce.
Facebook Shops
Source: Facebook
Many people don’t realize that third-party sellers generate about half of Amazon’s e-commerce revenues every year – and Amazon will generate almost $350 billion in annual revenue this year.
In fact, there are now over two million active third-party sellers on Amazon’s platform. And more than 15,000 small and medium-sized businesses surpassed $1 million in sales last year. Amazon gets a cut of all that action – that’s what Facebook is eyeballing here.
And it makes perfect sense.
Facebook gets more “face time” with consumers than any other company in the world. People spend more time using Facebook and Instagram than they do any other application. This practically guarantees that Shops will be an instant success.
That’s why Facebook (FB) has become a hedge fund favorite. Funds have piled into FB in recent weeks, driving the stock price up to new all-time highs.
I don’t think Shops will have much of an impact on Amazon, however. Amazon is too well-entrenched in the space. And there is plenty of room for multiple players.
E-commerce has exploded since the COVID-19 pandemic began, as consumers have shifted away from in-store shopping. That trend will continue even after COVID-19 is just a memory. In other words, the size of the e-commerce pie just keeps getting bigger.
Plus, Amazon has a card up its sleeve. Like Facebook, Amazon is working on its own digital currency. With its currency, Amazon will be able to incentivize its customers to stick with it by offering deals and discounts that are only available to digital currency holders.
Amazon has kept this strategy close to the vest, but it is coming. And it will have massive implications for us as tech investors. To get the full scoop, just go here.
The real scoop on hydroxychloroquine…
The mainstream media has given a lot of coverage to a hydroxychloroquine study that was published last week in The Lancet, a prominent medical journal. The media suggested that the drug was not an effective treatment for COVID-19 and was linked to higher death rates in patients.
The media is touting this study as “proof” that hydroxychloroquine, which President Trump has supported, is not a viable treatment for COVID-19 patients. But the media’s spin on this is simply irresponsible. Here’s why…
This study wasn’t a clinical trial. It was an observational study of 96,000 patients. It wasn’t structured like a clinical trial with placebos and control groups. It simply compared patients who took hydroxychloroquine (or the closely related drug chloroquine) to those who did not.
Double-blind placebo trials are the gold standard in the scientific community since neither the patients nor the doctors know who is getting the treatment and who is getting a placebo.
That’s why trial design is so important for biotechnology companies trying to get a therapy through the FDA clinical trial process. No one in the industry will accept data from a simple observational study as final because it is based on correlation, not causation. Yet that’s how the media is interpreting this study.
Fortunately, Novartis embarked on a proper double-blind placebo clinical trial using hydroxychloroquine and azithromycin back in April. We won’t have to wait much longer before we see results.
So I suggest we wait for data from a real clinical trial before passing judgment on hydroxychloroquine, just as we would for any other therapy.
And the National Institutes of Health (NIH) announced that it will also conduct its own clinical trial for hydroxychloroquine and azithromycin. I doubt the NIH would bother if it didn’t believe there might be a valid therapeutic approach to managing COVID-19.
I don’t have any position in the debate at all. Other than the positive results that we saw from the very limited trial of hydroxychloroquine and azithromycin in France, we don’t have enough information to feel strongly one way or the other.
But we’ll all benefit from knowing the results from the Novartis trial and eventually the NIH study as well.
Sadly, the mainstream media can hurt these critically important clinical trials. If they spread fear and misinformation widely, the NIH may have trouble recruiting patients to conduct a proper clinical trial.
Fortunately, the Novartis trial should be wrapping up soon, so I doubt that trial will be at risk.
Sony’s latest breakthrough (Hint: It’s not PlayStation 5)…
Let’s wrap up today with a quick thought experiment. When we think about Sony, what comes to mind?
I asked my team this question, and the most common answers were “the Walkman,” “high-definition televisions,” and “PlayStation.” I suspect many readers would give the same answers.
Ironically, Sony’s TV business has languished, and it completely failed with “digital Walkmans.” It missed the smartphone boom entirely.
And while Sony is a massive $66 billion corporation, its well-known PlayStation gaming division only makes up about 25% of its total revenues.
So what does Sony really do? The answer is a little surprising. Sony makes the best image sensors – semiconductors – in the world. These are the sensors that go into smartphones and security cameras that allow them to “see.”
Get this – Sony controls 49% of the global market share for image sensors. That’s right – it supplies nearly half of all image sensors in the world. That’s incredible. Its nearest competitor is Samsung, which carries a mere 18% market share.
And Sony’s image sensors just got a lot more interesting. The company announced a new sensor that incorporates memory and artificial intelligence (AI). This allows the sensor itself to identify images in microseconds.
For example, these sensors can be used in security cameras to identify a potential crime in real time. Or a business could install cameras with these sensors to make sure that all employees are wearing masks.
Perhaps more exciting, we could put these image sensors into autonomous vehicles so they could identify exactly what is in front of them.
What we are talking about here is AI running at the edge of networks. This is a massive trend enabled by smaller, more powerful semiconductors capable of running artificial intelligence.
Right now, most AI runs in the cloud. When an image sensor “sees” something, it must upload the image to the cloud, where an AI can analyze it and send back a response to the edge of the network.
That causes a delay, which means the image sensor can’t execute the appropriate response in real time.
Sony’s new chip changes that dynamic. It will allow the image sensor to respond in real time to whatever it is programmed to see. This is an exciting new product that is going to do very well.
Given the price point of just under $100, we can expect to see these showing up in commercial applications, like video surveillance cameras. And as declining semiconductor manufacturing costs come into play, we’ll soon have this kind of functionality in our smartphones as well.
Regards,
Jeff Brown
Editor, The Bleeding Edge
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