Is the Metaverse the Future of Office?

Big Tech believes the future of work is the "metaverse," first described in Neal Stephenson's classic sci-fi novel Snow Crash (1992). Or at least a less dystopian enterprise version, where employees will put on headsets and inhabit virtual offices. A surprisingly large number of Fortune 500 companies appear to be already using it. Jo Anna Stern of the WSJ shows how it works with the Spatial app, a leading firm in the space. 

I suppose in the future it'll come with the choice of either a subscription model or the usual "you are the product" model--free, but replete with background ads and ways to monetize your information. 

Close Call with Darth-gator!

From the Washington Post: "An alligator named Darthgator nearly ripped his trainer’s arm off. She can’t wait to work with him again."

The Value of Vaccination in Two Charts

Yesterday, we wrote about how Delta was raging in the U.S. as vaccination rates stalled and highlighted a paper from researchers at Carnegie Mellon and Pittsburgh University that painted a complicated picture of those hesitant to get vaccinated. A key issue was trust: both in the government and in the vaccine itself, from side effects to efficacy.

The latest data, reported by Bloomberg, does make a very compelling case that vaccines are effective against Delta, as captured by the below two charts:

No vaccine is 100% effective but based on data from the 24 states tracking "breakthrough" cases, only 1.7% of confirmed cases were in fully vaxxed people at the end of July.

And, crucially, even if people do catch Covid after being vaccinated, they’re much less likely to be hospitalized. So get your shots! 

 

McDonald’s is Just Too Tempting

A woman in Russia is suing McDonald’s because the franchise’s cheeseburger advert was so irresistible it caused her to break her fast during Lent. Umm, so should McDonald's be happy? Granted, said woman was fasting, but still...Maybe make her a spokesperson?

Of course, McDonald’s is no stranger to lawsuits. In 1992, for example, 79-year old Stella Liebeck famously sued McDonald’s after buying a cup of takeout coffee at a McDonald’s drive-thru in Albuquerque and spilling it on her lap. A jury awarded her nearly $3 million in punitive damages for the burns she suffered. The case was seemingly a huge deal at the time and became a cultural phenomenon, though a lot was inevitably lost in the media craze.

See it here…

The Lieback case was not frivolous once you dig deeper. At the time, McDonald’s served its coffee at 190 degrees (F), far hotter than the coffee made by home brewing machines. At that temperature a person could suffer 3^rd degree burns within a few seconds. However, there have been some strange legal cases, some that the plaintiffs even won! Here's a list of the Top 10.

A Sky Full of Stars: Who Gets Paid More?

Sports is big business. And the two biggest sports in the world are soccer (by far) and basketball. So naturally, the biggest names in these sports would be expected to be richly (ludicrously?) remunerated. But who's paid more, soccer or NBA superstars?

Well, on average, NBA players are better paid. The average NBA salary is $8 million/year compared to ~$4 million for players in the English Premier League (EPL)--the world's richest soccer league. But at the very top soccer players have the edge (click to enlarge):

                                    Source: RadioTimes.com and ESPN
 
The top 10 NBA players pull in, on average, $41.8 million/year. While the top 10 most expensive soccer players bring in, on average, $40.7 million/year--over $1 million a year less. However, the NBA is more egalitarian or sorts at the top (yes, that's an oxymoron) with Steph Curry (#1) and Klay Thompson (#10) making relatively similar amounts, $46 million and $38 million respectively. By comparison the difference between Messi's (#1) and Lewandowski's (#10) salaries is huge: $69 million vs $25 million. Seems odd, for the "people's game." But that's business.

MJ Still Holds the Highest Pay of Any NBA Player

Unlike in soccer, there's far less (little really) debate in basketball about the "best ever". Michael Jordan is easily consider by most basketball fans as that player. He not only lifted the Chicago Bulls to 6 championships but also globalized the NBA, bringing it billions of revenues in the 1980s and 1990s. So it's interesting to compare his salary with that of today's superstars.

Well, this article does just that. And MJ's 1998 salary of $33 million or $55 million in current dollar keeps him ahead of today's highest paid player Stephen Curry, whose 2021 salary is $45 million. But what's remarkable is how low Jordan's pay was for many years. The Chicago Bulls and the NBA as a whole got a great deal for most of his career (click to enlarge):

Jordan played 16 seasons in the NBA, really 14 (let's not count the 2 seasons with the Wizards). Only in two of those, 1997 and 1998, did he make more than $5 million per year! Curry's been in the NBA for 13 seasons, but he's pulled down an eight figure salary in 9 of them. 

To Jab or Not to Jab: Complex Picture of Vaccine Hesitancy in the U.S.

So, the Delta variant is raging and the U.S. is missing its vaccination goals. We've already had more Covid-19 infections in August already than all of July. In fact, the number of daily new cases is currently over twice the amount at the same time last year (129K vs 55K), though thankfully the number of daily deaths is just half (564 vs 1,140), primarily due to vaccines. Unvaccinated persons are responsible for 97% of hospitalizations and 99% of deaths, according to the CDC.

(click chart to enlarge) 

                                          Source: worldometers.info

Yet, vaccination rate has stalled at around the 50% mark for the U.S. population, despite widespread availability...But why? We'll based on the findings from a new paper by researchers at the University of Pittsburg and Carnegie Mellon there's no simple answer. In fact, a surprisingly diverse group of people are hesitant to get vaccinated against Covid-19:

Age Group:

                                 Percentage of each group that is somewhat vaccine hesitant. 

So...yeah, not surprisingly a much higher % of younger people are resistant to vaccines that older folks, probably because they are generally less impacted by Covid-19 (and basically every other virus/disease). These numbers are probably closely related to the next group.

What, Me Worry? Group:

                                 Percentage of each group that is somewhat vaccine hesitant.

Probably the biggest motivator for people to get a vaccine or not is simply whether or not they believe they, or their immediate family, can get severely ill from Covid-19. Those who worry they may show far less hesitancy than those who don't. It would be interesting to see the median ages of the "not worried at all" and "worried" cohorts. We'd guess some overlap between the above two charts.

Race/Ethnicity:

                                 Percentage of each group that is somewhat vaccine hesitant.
 

Hmm, this one is a bit surprising. We've read about how Blacks and Native American communities are less inclined to get vaccinated due to historical reasons. But that doesn't seem to be the case for Blacks in these findings. In fact, if anything Whites are more hesitant. Native Americans though do show higher resistance based on mistrust of the government. What is most perplexing is the Multi-Racial group.

Education:

                                                     Percentage of each group that is somewhat vaccine hesitant.

Well, well, well...this chart punctures the idea only the ignorant and brainwashed have issues with vaccines. PhDs (which subjects?!), arguably society's best educated and most informed people, also are seemingly amongst the most skeptical about vaccines. A higher % of PhDs are less likely to get  vaccinated than those with less education. By comparison, Master's degree holders have the least issue. Hmm, I guess as holders of the education middle ground (between high school drop outs and PhDs), they are "moderates" of this category.

Employment Status:

                                                     Percentage of each group that is somewhat vaccine hesitant.

Also surprising is that a higher % of people working outside the home are more resistant to vaccines than those working at home. Go figure.

Region:

                                                     Percentage of each group that is somewhat vaccine hesitant.

East, West, North, South...not much difference.

Urban vs Rural:

                                 Percentage of each group that is somewhat vaccine hesitant.

This one is consistent with most media reports. A higher % rural folks are hesitant to get vaccinated compared to urban dwellers. And the relationship is almost linearly higher as you go from Large Central Metro (city centers) to Non-Core (which are CDC classifications of counties).

Politics:

                                                     Percentage of each group that is somewhat vaccine hesitant.
   

Are Trump supporters really less likely to get vaccinated?...Um, yes. The researchers found that Counties with heavy Trump support in the 2020 elections had higher % of vaccination hesitancy than counties with less support. And the former President is just adding to that calculus.

Reasons Why?

So, from the above we get a sense who are hesitant to get vaccinated. The researchers then sought to understand why.

                                         Percentage of each group that is somewhat vaccine hesitant.

The biggest reasons are lack of trust...trust in the vaccine, trust in government. Religious beliefs, health issues and costs are comparatively small reasons. The most surprising reason: doctor had not recommended it? Huh? Who are these doctors? These findings are not all that different from a recent Kaiser Family Foundation survey.

So, many different types of people are skeptical about vaccines. But their reasons are mostly the same: lack of trust.

How Apple Makes Its Money

A few days ago we wrote about Apple, Inc's massive size. How its market cap was bigger than the GDPs of all but seven countries! Now the site Chartr has a cool...chart (what else?!) showing just how Apple rakes in $81 billion of gross profits per quarter  ($325 billion annualized)!!

The biggest source of Apple's revenue is, of course, iPhones. No surprise there. They have been the engine of Apple's money machine for over a decade:

All of Apple's products combined generate about $64 billion of sales per quarter with a healthy profit margin of 36%. At that scale, it's just amazing. But what surprised us and really excites investors is the company's Services Revenue (Apple Music, the App Store, Apple Pay, Apple TV, etc.). It's a lot bigger than we excepted--generating more revenue than Mac and iPad sales combined. Subscription revenues tend to be more predictable and stickier than product sales (have you ever cancelled anything once you sign-up?) and so are valued more highly by Wall Street, who apply a bigger multiple to such revenue streams. On top of that gross margins on Apple's services are a whopping 70%, nearly double its products margins...So why doesn't Apple buy a few studios or just Netflix?

Cigarette Company Asks Govt to Ban Cigarettes

Philip Morris International (PMI), is one of the world’s leading international tobacco companies and maker of the iconic Marlboro brand. So, it was a bit of a surprise this week to hear new CEO Jacek Olczak calling on the U.K. to ban the sale of all cigarettes within 10 years:

"Olczak said the company could “see the world without cigarettes … and actually, the sooner it happens, the better it is for everyone.” Cigarettes should be treated like petrol cars, the sale of which is due to be banned from 2030, he said."

Ooh, tell us more...According to Olczak, PMI plans to generate over half of its total net revenue from smoke-free products by 2025 and envisions a tobacco free world! Yay! This is some next-level ESG....or is it? Okay, so a few things. First, PMI is not entirely getting out of the tobacco business. It will offer vaping products, saying on its website that "smoke-free products" are not "risk free" but "are a far better choice than cigarette smoking." Second, it is good business. The economics of smoking is shifting away from developed markets, such as Western Europe, where the bulk of PMI's revenue are currently generated to more loosely regulated emerging markets. Moreover, the U.K. had already floated a plan to become a "smoke-free by 2030," noting smoking killed more people in Britain in 2020 than Covid-19. So, PMI is just being pragmatic in the face of changing to consumer habits.

But then there was also this: The company recently launched a £1bn takeover bid for Vectura, a British pharmacy company that makes respiratory inhalers and related medicines. Not surprisingly, this has upset anti-smoking campaigners who argue, not unreasonably, that "tobacco companies are positioning themselves as part of the solution to a smoke-free world, while continuing to aggressively sell and promote lethal cigarettes." Hmmm, so PMI plans to profit from selling inhalers to millions of patients who got (and are still getting) lung disease from using their products. That is good business, I guess?

You also have to say this about tobacco, despite attempts to shame it out of business in many Western countries, the industry has been remarkably resilient. Even though retail sales volume have declined, sales value has continued to grow (click to enlarge chart below). 

To quote John Oliver "it's an aging product that's decreasing in popularity and yet somehow can't stop making money...the agricultural equivalent of U2!" Harsh, very harsh...U2 is great, John! But he does make an important point(s). Ultimately, all the regulations in the U.S. and Europe push tobacco companies to market their products even more aggressively in developing markets. According to tobaccofreekids.org, 80% of smokers today live in low and middle income countries (click charts to enlarge). At current trends they estimate approximately 1 billion people will die from tobacco use this century. That's grim...but let John, circa 2015, explain: