Category Science/Technology

February 7, 2023

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• Google reported its first drop in advertising revenue since the beginning of the pandemic, with YouTube’s revenue down 8% year-over-year.
• YouTube is attempting to become an Aggregator of television, with its multiyear agreement to distribute NFL Sunday Ticket and its Primetime Channels launch.
• YouTube is also attempting to monetize its Shorts feature, with a revenue-sharing model similar to Spotify’s.
• Meta is facing pressure from YouTube’s monetization strategy, as it is more difficult to create compelling Reels than Stories.
• Google is more generous with YouTube monetization because it is a smaller part of its business, but other companies have a similarly cavalier approach to profitability.

Published February 7, 2023
Visit Stratechery to read Ben Thompson’s original post Google Earnings, YouTube’s Aggregation Bid, YouTube Shorts Monetization

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What Makes the Milky Way Special? [Brian Gallagher, Nautilus]

February 6, 2023

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• Miguel Aragon is a computational physicist at the National Autonomous University of Mexico, where he studies the large-scale structure of the universe, galaxy formation, machine learning, data mining, and visualization.
• The Milky Way is not special in itself, but its location is what makes it special. It is located near the center of a cosmological wall, a flat association of galaxies that forms a membrane between cosmological voids.
• The universe looks like a sponge, with cosmological walls, filaments, and clusters. Clusters are the densest parts of the universe, and walls are the least dense.
• The Milky Way is strangely large for living in a wall, and its velocity dispersion is 10 times lower than what is expected. This has been considered a mystery.
• Miguel Aragon has explored the possibility that the fact that the Milky Way is so massive in this wall may have helped the development of life.

Published February 7, 2023
Visit Nautilus to read Brian Gallagher’s original post What Makes the Milky Way Special?

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The Four Horsemen of the Tech Recession [Ben Thompson, Stratechery]

February 6, 2023

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• Stephanie Palazzolo wrote on Twitter that it was disorienting to see tech layoffs and then to see US job numbers increase and unemployment drop to its lowest level in 50 years.
• The four horsemen of the tech recession are the COVID hangover, the hardware cycle, Apple’s App Tracking Transparency, and the end of zero interest rates.
• The COVID hangover is the single biggest issue facing tech companies, as consumers with no way to spend discretionary income and flush with stimulus checks bought new devices, subscribed to streaming services, and used cloud computing.
• The hardware cycle is impacting companies like Apple, Microsoft, and Intel, as well as TSMC, as production slowdowns and pent-up demand for Apple Silicon-based processors have caused revenue to drop.
• Apple’s App Tracking Transparency has caused a decrease in ad revenue for many tech companies, as users opt out of tracking.
• The end of zero interest rates has caused tech companies to re-evaluate their investments, as the cost of capital has increased.
• The COVID hangover refers to the inevitable slowdown in tech sales after the initial surge due to the pandemic.
• The end of zero interest rates refers to investors realizing that the cost of capital input in their equations can be something other than zero, and the price they are wiling to pay for growth without profitability is falling through the floor.
• The ATT recession refers to Apple’s App Tracking Transparency (ATT) initiative, which fundamentally disrupts the “hub-and-spoke” model of digital advertising, leading to a crash in revenue growth for companies that rely on performance marketing.
• The article argues that the impact of ATT has been underestimated, and that ascribing the advertising revenue headwinds to macroeconomic factors is misguided.

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What Is Scientific Discovery Worth? [Paul M. Sutter, Nautilus]

February 3, 2023

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• Neutrinos have been a mystery for nearly 100 years, and the Deep Underground Neutrino Experiment (DUNE) was created to try to catch them.
• DUNE is a $1.7 billion project funded mostly by the Department of Energy, and it involves the most powerful neutrino beams ever created, 10,000 tons of ultra-pure liquid argon, and 800,000 tons of excavated rock.
• Neutrinos are everywhere, but they are so small and charge-free that they are difficult to catch and study.
• Other neutrino detectors, such as Super-Kamiokande and IceCube, have been built, but they have only managed to capture a handful of neutrinos.
• DUNE is now running about a decade behind schedule and over budget, and the DOE is questioning whether the project is worth the investment.
• The only way to find out if DUNE will be successful is to build it out and flip it on, but this raises the question of what scientific discovery is worth.

Published February 3, 2023
Visit Nautilus to read Paul M. Sutter’s original post What Is Scientific Discovery Worth?

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An Interview with Eric Seufert About Meta’s Earnings and the Google-DOJ Case [Ben Thompson, Stratechery]

February 2, 2023

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• Eric Seufert discussed Meta’s earnings and the Google-DOJ case.
• Meta’s earnings showed a decrease in revenue but a skyrocketing stock price.
• Seufert discussed the importance of increasing impressions and the corresponding decrease in price, as it crowds out competitors and provides more room to grow.
• He also discussed the four ways to increase ad revenue for an ad platform: increasing ad load, increasing reach, increasing the value generated by ads, and increasing time spent on site.
• Facebook has managed to increase engagement and ad load, and has introduced new ad placements to increase the value generated by ads.
• Increased ad load on Reels is justified, as it had no ads before.
• Facebook has created new ad formats, such as click-to-messaging, which have the potential to convert better than other ad formats.
• AI and machine learning are being used to automate the process of managing campaigns, eliminating human error and inefficiency.
• The black box automation suite, Advantage Plus, is used to test different permutations of audiences and creative to find the right mix.
• The application of AI and machine learning is more compelling from the advertising side than the consumer side.
• Generative AI can be used to create assets and interpret what works and what doesn’t.
• The end game is for Facebook to integrate these tools and do it for the advertiser.
• The duopoly of Google and Facebook is over, as brand advertising is moving onto the web from TV in a meaningful way.
Amazon is the one big exception, and ATT has been an accelerant for their ad business.
• Apple and Amazon are capturing direct response budget that has fled from Facebook.
• Facebook is trying to recapture some of those dollars by improving efficiency and engagement, and taking more of the human element away.
• Facebook reintroduced 28-day click attribution reporting, which is modeled, in order to comply with ATT.
• SKAdNetwork 4.0 is more signal, and the biggest platforms will benefit most from it.
• Apple may be shooting themselves in the foot with ATT, as they benefit from in-app purchases.
• ATT has caused a difficult transition for mobile gaming, but Apple may start providing better measurements and signals to help developers.
• Facebook’s earnings results validate the ATT Recession thesis, with revenue down 4% year-over-year.
• Recent decisions in Europe have been problematic for ad targeting, with Meta not allowed to use a contractual basis to get user agreement for ads, WhatsApp not allowed to use first party data for general analytics and security, and Voodoo Games not allowed to use the IDFV.
• The European Union is not likely to allow companies to offer services on terms they don’t want, and this could lead to decreased monetization in Europe.
• Activists and special interests may prevent the right thing from being done, preventing the use of AI technologies.
• The DOJ’s case against Google is that it used its end-to-end ownership of the ad tech stack to suppress competition and prevent other companies from being able to compete.
• The DOJ’s argument is flawed because it portrays supply as chasing demand, when in reality, it is the other way around.
• The DOJ’s chief harm demonstration is that publishers made more money than they should have, which is the only part in the stack where there is arguably lock-in.
• The counterfactual is not that advertisers would have gotten more margin on their ad spend, but that they would have been starved from incremental conversions if Google had not made this available at all.
• The remedy proposed by the DOJ is to split off the exchange and the publisher tool, which highlights the weakness in the case itself because Google Ads are first and foremost for Google Properties.
• Facebook is building up customer engagement to attract advertisers.
• Google divesting Google Ad Manager and AdX could lead to lower prices for publishers and higher prices for advertisers.
• Google is acting as a market maker, pricing long-tail traffic that would otherwise go unsold.
• Google’s data gives them an advantage in pricing, and they may be keeping the third-party ad business alive for the data rather than the revenue.
• Stricter privacy regulations benefit larger companies with more signal.
• Advertisers choose Google because they have no choice, but if Google had been more transparent about their practices, they may not be in as much trouble.

Published February 2, 2023
Visit Stratechery to read Ben Thompson’s original post An Interview with Eric Seufert About Meta’s Earnings and the Google-DOJ Case

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Hear the Wind on Mars [Katherine Harmon Courage, Nautilus]

February 1, 2023

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• NASA released a recording of wind on Mars in December 2022, the first time humans have ever heard a Mars-made sound.
• The recording was captured by the NASA Perseverance rover’s microphone, which was on for less than 85 minutes in the first year of the mission.
• Scientists used the sound to estimate the density of dust grains in the dust devil.
• The wind on Mars is gentle, with atmospheric pressure just 1 percent of Earth’s.
• Dust devils on Mars are caused by hyperlocal temperature differences, which create just the right conditions to kick up swirling dust devils.
• Sound is exceedingly rare in the universe, and scientists are hoping to listen to liquid methane on Saturn’s moon Titan.

Published February 1, 2023
Visit Nautilus to read Katherine Harmon Courage’s original post Hear the Wind on Mars

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Intel Pay-Cuts, and Revisiting the Dividend Question; Investor Honesty; AMD’s Earnings [Ben Thompson, Stratechery]

February 1, 2023

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• Intel is cutting management pay across the company to cope with a shaky economy and preserve cash for an ambitious turnaround plan.
• Intel is still committed to offering a competitive dividend, but analysts have speculated that the company may lower its payout to cope with the slowdown.
• Intel is cutting costs tremendously at the expense of their employees, including quarterly pay bonuses, annual bonuses, 401k match, merit-based raises, and a pay cut to all employees’ base salary.
• Intel should suspend the dividend when Pat Gelsinger announced IDM 2.0, but instead he pursued the same path as his predecessors.
• AMD is gaining marketshare in the data center, with sales to North American hyperscalers more than doubling year-over-year.
• AMD is back on top in terms of margin, with Intel’s underutilization of its fabs costing the company four points of margin.

Published February 1, 2023
Visit Stratechery to read Ben Thompson’s original post Intel Pay-Cuts, and Revisiting the Dividend Question; Investor Honesty; AMD’s Earnings

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The Algae That Might Save Earth’s Coral Reefs [Juli Berwald, Nautilus]

February 1, 2023

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• Scientists have discovered a new species of algae, *Durusdinium*, which may be a key factor in the survival of coral reefs, and Rob Rowan, who inspired the research, has mysteriously disappeared.
• The term “symbiosis” was coined by German botanist Anton de Bary in 1879.
• Karl Andreas Heinrich Brandt discovered that the small amber orbs lining the digestive tissues of marine creatures were not part of them, but a type of symbiotic algae, which he named “zooxanthellae”.
• Rob Rowan realized that DNA had the power to reveal what microscopes could not.
• Rowan and Dennis Powers published a genetic analysis of zooxanthellae in the journal Science, which revealed that zooxanthellae are not all the same and that there are at least three species.
• Andrew Baker and Rowan found that corals hosting the species *Durusdinium* did not bleach during a historic El Niño system, and that these corals became more common.
• Australian scientists discovered that juvenile coral hosting *Durusdinium* grew two to three times slower than their siblings hosting other symbionts.
• Baker believes that “people have been maybe too willing to label *Durusdinium* as being selfish” and suggests that something about *Durusdinium* stresses coral out, toughening them up so they can withstand future conditions.
• Baker and his colleagues followed the fates of more than 100 corals around the central Pacific island of Kiribati during a severe, 10-month-long heat wave and found that corals already hosting *Durusdinium* didn’t bleach, but few survived.
• In 2014, near Miami, coral researchers noticed that many brain coral, maze coral, and boulder coral were dying from Stony Coral Tissue Loss Disease.
• Baker’s graduate student Caroline Dennison performed experiments bleaching *Breviolum* from the coral and then providing them with *Durusdinium* and found that the corals hosting *Durusdinium* were two to three times less susceptible to the disease.
• Rob Rowan, a scientist who inspired both the author and Andrew Baker, has disappeared without a trace.
• Baker is a scientist studying coral and their symbiotic relationship with algae.
• A new species of algae, *Durusdinium*, is being found in coral reefs and may be a key factor in their survival.
• Baker is unsure if this new species will save coral, but believes it will be a big part of their biology.

Published February 1, 2023
Visit Nautilus to read Juli Berwald’s original post The Algae That Might Save Earth’s Coral Reefs

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Instagram’s co-founders are mounting a comeback [Casey Newton, Platformer]