Spotify bets on the pod

Also in today’s edition: Tech vs. telcos; Everyone’s clucking for chickens; US imports are falling steeply; No spoonful of sugar for NMC’s medicine

June 10, 2022 • Estimated Reading Time: 12 minutes

Good morning! Apple's iconic 'Think Different' slogan cannot be used by the tech giant anymore. The European Union's highest court is of the view that the slogan isn't distinct enough. Swatch, meanwhile, has been cashing in on the hype by using the “Tick Different” slogan for its campaign. Well, you can’t win them all.

The Market Signal*

Stocks: Benchmark indices finally settled in the green, ending their 4-day drought. LIC fell for the eighth straight day, 24% lower than its issue price. Brent crude oil hit $124 per barrel. Back home, Oil India shares hit a seven-year high. 

Early Asia: The SGX Nifty (0.07%) and Hang Seng Index (1.14%) slumped in early trade at 7.30 am India time. Nikkei 225 dropped 1.29% from its previous close.

F&B

The World Is Counting Its Chickens

The most-consumed protein on the planet just got a boost. Annual per capita poultry consumption has zoomed to nearly 15 kg; that’s 28% more than pork and 57% higher than beef. Chicken could soon constitute 41% of global meat consumption by 2030.

How come? Red meat has become dearer because of inflation and supply chain disruptions. As a cheaper source of protein, chicken is finding more takers over pork and beef even in traditionally red meat-friendly countries such as Brazil, China and Mexico. Restaurants in China—the largest pork-consuming country—are making a switch. 

What else? The cost of rearing chickens has reduced over the years. This has not been the case with red meat. Some companies are focusing specifically on white meat, since factory-farmed beef emits more greenhouse gases. No wonder beef producers are courting “carbon positive” farming.

🎧 Chicken has left behind red meat to become the world’s favourite source of protein.

TELECOM

A New Battle Brews

After captive coal mines and power plants, it is time for captive telecom networks. The government is willing, and tech giant TCS is putting its weight behind it. 

Nay! Naturally, Airtel, Jio and Vodafone have their knickers in a knot. Captive networks will have their own data network, which means telecom operators will lose high-value customers. 

Aye! Although Trai had recommended it earlier, the government was of the view that private enterprises can buy or lease spectrum from telecom operators or get them to build networks for them. 

Maybe: Across the aisle from telecom operators is Broadband India Forum lobbying for tech companies. It seems to be working. The government is veering around to the view that enterprises can directly buy spectrum from it.

HEALTHCARE

NMC Turns Bad Doctor

If the National Medical Commission (NMC) has its way, doctors can refuse treatment on grounds of “abusive, unruly, and violent” behaviour by patients or their relatives.

India’s authority on medical education and professionals—which has invited comments on the National Medical Commission Registered Medical Practitioner (Professional Conduct) Regulations, 2022—proposed that registered medical professionals report such instances before referring patients to “further treatment elsewhere”. The clause falls under Section 26 of the draft.

For the first time, the NMC also defined ‘emergency’ as “a life and limb saving procedure”.

The Signal

The NMC’s draft has already received pushback. In a statement, the charitable organisation People for Better Treatment (PBT), headed by Dr Kunal Saha, is seeking a removal of Section 26. If that doesn’t transpire, PBT will seek legal recourse.

Section 26 is worrisome because there’s no definition of (or arbiter for) “abusive, unruly, and violent” behaviour. This leaves plenty of room for subjective interpretation, especially in instances where people stress-vent when a loved one’s life hangs in the balance.

NMC’s arbitrariness also applies to its definition of an emergency. Consider a ruptured or perforated appendix, which can be fatal if medical response is delayed. But appendicitis isn’t typically considered a “life or limb” situation.

The PBT notes that NMC’s proposals are against the fundamental right to life. Why, even the president of the Indian Medical Association points out that refusing treatment is ethically wrong.

🎧 NMC proposes to allow doctors to deny treatment to some patients. It’s a slippery slope. Dive in.

TRADE

Boxes Forecast A US Import Slowdown 

Exporters in India and elsewhere who ship to the US market have something to worry about. US imports are plummeting.

Retail worries: Imports had dropped 3.4% in April. More importantly, shipping containers sailing to the US have fallen 36% since May 24, portending more pain in the coming weeks and months. Multiple factors have contributed to the slowdown. Runaway inflation, tight home budgets and an inventory pile-up has forced companies to cut down on import orders until normalcy returns. 

Retailers Walmart and Target suffered their worst on the stock market since 1987 after a disappointing fourth quarter and gloomy guidance for the year. 

Top trader: The US beat China to become India’s top trade partner in 2021-22. India has moderated its merchandise export expectations anyway. Yet, more orders could vanish and exports could suffer.

STREAMING

Spotify Goes All In On Podcasts

Spotify is going big on podcasts and audiobooks. At its first investor presentation since 2018, it also announced its intention to target one billion listeners by 2030.

Hot pod: Spotify invested $1 billion in its podcast business, but collected only $215 million in revenue. Yet, company chief Daniel Ek is sticking to his guns about podcasts being a “$20 billion global opportunity” that will bring in 40% gross margins, considering one-third of Spotify listeners listen to podcasts. But we’ll wait and watch until then.

Lights, sound, action: In November 2021, Spotify acquired audiobook platform Findaway. It will take on Amazon's audiobook platform, Audible. Spotify has fingers in nearly every pie. It is also looking to lure content creators to the platform. The streaming giant lost 53% of its market value in 2022 and hit a record low in May after investors cast doubts about its podcast plans. 

FYI

Boot camp: A consortium comprising Reliance and Apollo Global Management have made a $6.3 billion binding offer to acquire the international arm of British health and beauty retailer Walgreens Boots.

Cold-shouldered: India may restrict refrigerator imports to “promote local manufacturing”. The move will affect LG, Samsung and other international brands’ shipments to the country.

Purplle rain: Online beauty retailer and Nykaa rival Purplle has raised capital at a $1.1 billion valuation, making it the newest entrant in India’s unicorn club.

Ka-ching: CRED has raised $80 million in a Series F funding round. Cashify, which buys and sells second-hand smartphones, raised $50 million in its Series E round. Content marketplace Pepper got a $14.3 million Series A infusion. 

Ant march: Chinese regulators have reportedly greenlit Alibaba founder Jack Ma’s IPO plans for Ant Group Co.

Lobby push: Amazon, Alphabet (Google), Apple, and Meta have collectively spent $36 million on ads opposing a US antitrust legislation that would prevent them from promoting their own products and services on their platforms.

Out:  Sri Lanka President's brother and former finance minister, Basil Rajapaksa, resigned from parliament. This makes him the second person from the Rajapaksa family to step away. 

FWIW

Do-gooder: Rapper-cannabis entrepreneur Snoop Dogg is a generous employer. It's unsurprising that Dogg has a professional blunt roller given his busy lifestyle. His annual salary? A lavish $40,000-$50,000 in 2019. The full-time joint maker has been given a pay rise to keep up with rising costs. We hope employers are taking note.

Copycat: Trader Joe's is in a pickle. When it released a watered-down version of its Indian garlic aachar, run by an Indian, its consumers knew it was a case of copypasta. The outcome? Trader Joe's is rightfully receiving grief on social media for cultural appropriation and whitewashing its products. 

Bait: The humble fish is getting a bad rep. According to US researchers, eating even two portions of fish per week can increase the chances of skin cancer. Fortunately, there are too many ifs and buts in the study and it is not a randomised one. Incidentally, an ICMR study last year found that north and northeast India have higher chances of developing skin cancer. The coastal areas around the West and South showed lower incidence. Okay, then. 

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