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This week Amazon completed its acquisition of iconic studio Metro-Goldwyn-Mayer (MGM) for $8.45bn. That deal is Amazon's second largest ever, just behind the $13.2bn that the e-commerce giant paid for upscale supermarket Whole Foods back in 2017.
MGM's most well known asset is undoubtedly its 50% share in the rights to the James Bond film franchise, which it shares with Eon Productions. Fans of Bond were concerned that the Amazon deal might have meant a "straight to streaming" model for 007, but assurances have been made that Bond producers will keep Bond in cinemas, as well as maintaining control over who plays the character and the creative direction of the franchise.
More stuff stuffed into Prime
For Amazon, the deal offers further proof of the company's desire to compete seriously in streaming. It will also bolster the quite eclectic range of services offered with its Amazon Prime membership.
As we wrote about last year, Prime's offer is quite a random collection of services which include free delivery, a streaming service, some music, an Amazon credit card, some discounts at Whole Foods and some other random stuff. Crucially though, only 11% of customers polled gave the streaming service as their primary reason for having Amazon Prime, the overwhelming majority (79%) were in it for that one-day delivery.
The strategy, presumably, is to offer such a wide range of services — TV, movies, e-commerce, delivery, music, groceries and more — such that consumers almost can't get away without having Prime. Already there are 175 million Amazon Prime members around the world who seemingly feel that way — and each spends significantly more on Amazon.com than non-Prime members.
The pandemic has upended the way of working for millions of people that are fortunate enough to be able to work from home. For some people that's meant a full transition to WFH, for others it may mean a few days out of the office per week.
The rise of digital nomads
The more extreme version of working from home, is working from anywhere. The pandemic accelerated a trend that had been gaining popularity as early as 2018 — the idea of being a "digital nomad" — that is someone who can work fully remotely thanks to the internet, and often moves about frequently, either from city to city or even country to country (COVID permitting).
The term digital nomad was first coined back in 1997, but it's taken a lot longer to gain significant traction. There are now more than 1.1 million members to the forum r/digitalnomad on social media site Reddit — which is home to many communities including, most notably, r/wallstreetbets.
For tech-savvy workers able to work remotely, the pandemic has removed even more barriers to becoming a digital nomad. It's now fully acceptable to take Zoom calls from odd locations, and as internet connectivity continues to improve it seems inevitable that more people will decide to keep working as they travel if they can — rather than having a hard stop or reset in their career — even if it's only temporary. Any digital nomads reading this? Let us know!
Ford, arguably one of the most iconic American companies of the last century, announced this week that it plans to invest $30bn into electric vehicles over the next 5 years. Ford is shooting for 40% of its sales to be electric vehicles by 2030 — a target investors seemingly enjoyed as the company's shares rose almost 15% on the news this week.
Huge company, slim margins
Few industries are as competitive as making and selling cars — and Ford's financials are a prime example of this. Despite being a giant, Ford ekes out a slender profit margin. Since 2012 Ford's average net profit margin has averaged just 2.7%. With revenues regularly north of $150bn, that still translates into a sizeable profit of $4bn a year (on average) — but it doesn't leave much room for error if sales fall, costs rise, or both.
With that context in mind, the decision to invest $30bn into electric vehicles, when average net profit is around $4bn, is a big commitment — and it reflects a confidence at Ford that it will be $30bn well spent. Reservations for the Ford F-150 Lightning, Ford's new electric pick-up, have just passed 70,000 orders. Ford is getting serious about electric.
1) Japan is set to host the Olympic Games in less than 2 months, but the country is currently dealing with a resurgence in COVID-19. This week the country extended its state of emergency in Tokyo and other regions as it tries to contain the latest uptick in cases.
2) Germany has committed $1.3bn to Namibia and Namibian residents for its role in the genocide of the Herero and Nama ethnic groups more than 100 years ago.
3) Eric Carle, the author and illustrator of The Very Hungry Caterpillar, which sold more than 50 million copies worldwide, has died aged 91.
4) 96% of companies surveyed by Flatfile have said they've run into problems with data onboarding. If your business is one of the 96%, try Flatfile Portal.**
5) Deepfake videos of Tom Cruise are scary enough, now get ready for deepfake maps.
6) A number of landmark moments in the oil industry this week as a Dutch court ordered Shell to cut its emissions by 45% in this decade and shareholders of ExxonMobil and Chevron rebelled in the US over their low-carbon strategies.
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