This week's 3 Bells
We ring 3 bells for you from the future of business and work
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Why do we hate adverts these days?
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A new report suggests nearly 420 million people are using ad-blocking software now - a 90% rise over the past year. That's one in five smartphone users.
This is especially so in emerging markets. 36% of smartphone owners in Asia-Pacific block ads, compared to just 2% in America. Why so? Probably because in countries where connectivity costs are a higher proportion of income, blocking ads reduces bandwidth use and load times.
This is of course a serious threat to the future of not just the advertising industry, but to that of media and journalism as well. For so long, the deal was this: look at these ads, and we won't charge you for the content. That deal is increasingly off the table. For the advertising industry, this is an existential crisis: why don't people want to look at adverts any more? Because the adverts are uninteresting and distracting. The problem is more acute on mobile, where adverts are typically interruptive and annoying.
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If you're in advertising, it's time to stop popping champagne and start to think clearly. Advertising only has a future if it fits into people's lives more easily, and does not get in the way of what they actually want to be doing.
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The robot factories are already here
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I dedicated a whole edition of this newsletter to the rise of robotics recently. You may have been tempted to think I was exaggerating. So here's a thing: Adidas just announced it will bring the manufacturing of some of its shoes back from Asia to Germany. There's a catch, though: the new 'speedfactory' will be almost entirely robot-run. That's the only way manufacturing can be brought back home.
Meanwhile Foxconn, supplier of Apple and Samsung, was reported to have replaced 60,000 factory workers with robots. That's because the 'China price' (low labour costs) is increasingly disappearing, and China will only keep all those plants from going back to Europe and America if it is able to compete using robots.
Paying attention now?
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Seismic shifts are coming in the economic and business landscapes of the near future. Stay woke, and stay flexible.
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Microsoft finally gives up on phones
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That must have been one of the all-time worst business investments. Two years ago, Microsoft paid Nokia $7.2 billion for its phone business. Since then, it has written off $7.6 billion from this acquisition. Last week it announced another writedown of nearly $1 billion, with 1,850 jobs going. The language of the announcement suggested there may not be any new Lumia phones henceforth.
Not many will be lamenting as Microsoft's Lumia line has been an abject failure, unable to get any traction against the world's dominant Android and iOS phones.
Microsoft will now (rightly) focus on the enterprise: if it stays in phones, it will only be to focus on business phones to match its successful Surface Pro tablet line. Microsoft will now probably hope to pitch its future on artificial intelligence, virtual reality and bot software. It's pretty much with done with consumer devices.
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When strategy is driven by technology, you have to be focused on windows (ahem) of opportunity. If you're too distracted or too timid when a window opens, you will lose the game. Microsoft squandered billions on phones when it was already too late. Now, it has to be ready for a different window to open.
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