- Epic Games is making moves in metaverses…
- The Web 2.0 model is making its final stand…
- This AI can predict heart attacks before they happen…
Dear Reader,
Poison…
It was hugely disappointing to see Twitter’s board of directors make such a predictable and banal decision to adopt a poison pill in an effort to thwart Elon Musk’s attempted acquisition of Twitter.
We don’t usually get to talk about poison pills in The Bleeding Edge, so today’s subject is interesting. Poison pills are designed to disincentivize an acquirer or acquirers from making a run at a company.
In this case, Twitter’s pathetic board put a structure in place whereby if any individual or entity acquires 15% or more of Twitter’s stock without board approval, all other shareholders will be permitted to buy additional shares of stock at much lower prices.
The idea is that if shareholders did start purchasing additional stock at much lower prices, it would result in a large material loss for the party attempting to take control.
Better yet, depending on how far the board would be willing to go, they could continue to “print” more stock and dilute existing shareholders, including Musk, in an effort to make it impossible for Musk to ever gain control.
This raises an important question… Why?
Why is the board so adamantly opposed to an acquisition by Musk, who is arguably the most brilliant entrepreneur of our time? Bringing Twitter back to life would be like child’s play for him, and he has already outlined a plan to do so. It’s something that needs to happen – and so many of us in the industry know this.
And who is the board anyway? Do they really represent the views of the shareholders? Do they own the majority of Twitter? Here’s what ownership looks like at the board level:
| Twitter Board Member | Ownership (%) |
| Bret Steven Taylor | 0.007% |
| Parag Agrawal, PhD | 0.063% |
| Mimi Alemayehou | 0.063% |
| Fei-Fei Li, PhD | 0.001% |
| Egon Pierre Durban, MBA | 0.002% |
| Robert B. Zoellick | 0.003% |
| Patrick Pichette | 0.003% |
| Martha Baroness Lane Fox | 0.004% |
| Omid R. Kordestani, MBA | 0.023% |
| David S. Rosenblatt, MBA | 0.014% |
| Jack Patrick Dorsey | 2.253% |
As we can see above, aside from Dorsey – who will be stepping down from the board next month – the remainder owns an absolutely insignificant amount of the company. They certainly don’t represent the shareholders in terms of ownership… In fact, the lack of vested interest is pretty remarkable.
Musk is right to ask for an actual shareholder vote concerning his acquisition offer. The shareholders should decide.
The board is happy to adopt the poison pill because they clearly don’t care if the value of the stock drops. This is a ridiculously perverse incentive, and the board clearly is not performing its duties in the best interests of Twitter’s shareholders.
What we’re seeing right now is the depth of corruption in social media.
It’s not about building a good business, serving your customers, and respecting your shareholders… It’s about data surveillance and the ability to exert control over a population.
The board isn’t fighting against an acquisition, it is fighting against what it sees as a loss of control… The loss of the ability to filter what we see, the loss of the ability to control the political narrative, the loss of the ability to censor, ban, and deplatform those who they don’t agree with.
It is now obvious that Twitter’s board doesn’t care what the population wants, it doesn’t care what its shareholders want, it just wants to maintain its abuse of power over what we see and are “allowed” to think.
And that’s precisely why Musk must prevail.
Whether it means a successful acquisition of Twitter or moving forward with his backup “Plan B,” we need to have a digital townhall that allows for freedom of speech, ideas, and open discourse – as compared to today’s platforms that are designed to create division, anger, and hate.
A sleeping giant in the metaverse space…
Epic Games is making some interesting moves. The gaming titan just inked two strategic partnerships that will power the development of metaverses going forward.
We have been tracking the rise of Epic Games for a few years now.
For the sake of newer readers, Epic Games is based in North Carolina. And it is the creator of Fortnite, one of the most successful video games of all time.
Epic Games also built its own gaming engine called the Unreal Engine. This is one of the two most widely used gaming engines in the world. Epic Games licenses it out to companies interested in building new games on top of it, which puts Epic in a powerful position in the industry.
I view Epic as already having established its own metaverse through Fortnite, but clearly, it has an even larger vision.
The first partnership is with Lego Group. I’m confident readers are familiar with Lego. This company has built a fantastic brand around little plastic pieces used to build all kinds of creative objects and designs.
Lego Kit
Source: CreativeBloq
But in today’s world, kids are less and less interested in working with physical toys and puzzles. I see this firsthand with my own children. Both of my boys prefer to interact via a digital medium.
That’s why Lego is partnering with Epic Games. The two will collaborate to build a metaverse incorporating the Lego brand. This will provide new digital experiences for kids who would be less inclined to play with physical Legos.
Of course, Lego will leverage Epic Games’ technology to bring its metaverse to life. And in exchange, Lego is investing $1 billion into Epic, which is still a private company.
Epic Games’ other major partnership is with Sony. We know Sony as a major player in the gaming space thanks to its PlayStation gaming console. This gives Sony a deep content portfolio of games and franchises – some of which have become incredibly popular.
For Sony, building a metaverse around its popular gaming franchises could be incredibly lucrative. However, the company isn’t really known for its software prowess. It is best known for building gaming consoles and producing content.
That’s where Epic Games comes in. Like Lego, Sony will leverage Epic Games’ technology. And it is also investing $1 billion into the gaming titan in return.
So Epic Games just raked in an additional $2 billion to power metaverse development forward. Major brands like Lego and Sony have been moving quickly to establish a presence in the more popular metaverses, and in this case, they are looking to have a stronger influence on the development of the metaverse itself.
As a reminder, this $2 billion investment comes right on the back of the company’s $1 billion venture capital raise last April.
Epic Games not only has the technology, but it also now has the capital to support an industry-leading level of investment in metaverse development. This, of course, makes Epic Games a potential investment target after it goes public.
What’s more, Epic Games is going to be a great counterbalance to companies like Facebook (now Meta), which recently revealed that it is taking a far more closed approach to building its own metaverse.
And that brings us to our next topic…
Meta wants to trap us inside its metaverse…
We just got a good look into Meta’s plans for its “Horizon Worlds” metaverse. It’s all about total control.
To start with, Meta is now developing a digital currency called “Zuck Bucks,” based on CEO Mark Zuckerberg’s name.
What an awful name for the currency – I’m sure the company will change that before it launches. Meta is also developing a creator coin to incentivize developers.
What’s interesting here is neither Zuck Bucks nor the creator coin will be blockchain-based. They are both tokens that only work inside of the Horizon metaverse.
In other words, these assets are not fungible. We cannot sell them for other digital assets like Ethereum.
That also means we can’t convert them into fiat currency like the U.S. dollar. They only have value within Meta’s metaverse.
And it gets even worse.
Meta will pay gaming developers in its creator coin as an incentive to make content for the Horizon metaverse. But then Meta will charge a 30% tax on content sold on its platform. And the company will charge another 25% tax for the use of content in the Horizon metaverse.
Put them together and the combined tax rate is a whopping 47.5%. That’s absurd. Even the U.S. government can’t get away with tax rates that high.
Clearly, Meta is trying to protect its Web 2.0 business model.
As regular readers know, Meta and Google are the epitome of Web 2.0 corporations. For decades now, both companies have profited tremendously from the content that people produced within their ecosystems.
Not only did these giants not pay content producers a dime… but they also collected their personal data and sold access to it to advertisers without their explicit knowledge.
We have talked a lot recently about the Web 3.0 movement, which seeks to break this cycle. Web 3.0 features blockchain-based currencies and economic incentives for producers. It’s designed to share in wealth creation and incentivize collaborative behavior.
Here we see Meta trying to resist this transition. It is creating a walled garden designed to trap everybody within its own metaverse.
That’s why Zuck Bucks aren’t convertible into anything. They force people to interact within the Horizon metaverse.
This is not a strategy for success.
Capital and time will go to where it is best treated. This is especially true in a digital world enabled by blockchain technology.
Simply put, the Web 2.0 model will not be able to compete with metaverses built using Web 3.0 incentives.
After all, if people can earn real income by spending time in a Web 3.0 metaverse, why in the world would they waste time in Horizon Worlds? Some of course will, but there will be a massive shift onto platforms that incentivize participation and creation with real, fungible currency.
So this battle of ideologies will be something to watch over the next couple of years. Web 2.0’s final stand will play out quickly once these new blockchain-enabled platforms are simple and easy to use.
This predictive AI could save people from heart attacks…
We’ll wrap up today with a great artificial intelligence (AI) application out of Johns Hopkins University.
Using a form of AI called deep learning, a team at Johns Hopkins developed an AI that can predict an individual’s likelihood of having a fatal heart attack within the next 10 years.
This is critical because sudden cardiac death accounts for as many as 20% of all deaths worldwide.
Of course, the implication here is that if we can see it coming, we can immediately take corrective action. That could be simple environmental changes, or it might be surgery for patients most at risk.
So this is a fantastic development that could increase life expectancy for patients at risk of heart attacks.
Here’s how they did it…
The team started by creating two neural networks. This is the same kind of AI technology that our Perceptron uses to identify crypto trades. (You can find more info about that right here.)
Then they collected hundreds of heart scans from patients with cardiac scarring and ran them through the neural networks. This effectively trained the AI to recognize and understand different cardiac scarring patterns.
Next, the team pulled clinical data for each patient represented by the heart scans. They combined the two into a deep learning model, and that allowed the AI to make connections that human doctors wouldn’t recognize.
It turns out that the AI could predict the chance of cardiac death with 74% accuracy… a far better figure compared to the world’s top cardiologists.
It all comes down to neural network technology. It allows the AI to “see” what humans can’t.
And keep in mind, this study used a limited data set from just hundreds of patients. The AI’s accuracy will increase if the team at Johns Hopkins puts together a much larger data set to feed into the neural networks.
So this is yet another exciting development to watch.
It’s also another sign of the convergence between AI and biotech that we’ve discussed many times in The Bleeding Edge. With AI’s help, we’re going to make incredible medical discoveries and speed up drug development.
This is one of the most life-changing trends we follow here… and we’re going to profit from the convergence as it really begins to take hold. To learn more, simply go right here for the full story.
Regards,
Jeff Brown
Editor, The Bleeding Edge
Like what you’re reading? Send your thoughts to [email protected].