April 24 2023 - Monday Mania

👋Happy Monday – it's a new week, and it should be a busy one. Quick take is back, so let's get into it.

Joe's Quick Take

• All eyes on earnings this week – let's see how everyone is fairing, especially with the Fed meeting in early May where they could potentially raise rates. From Tech to CPG.
• Confirmation of layoffs at R/GA with varying numbers, Lyft with another round as well
• We got that Pixel Fold leak right on time! Meh.
• We're going to talk about Unrecord, the UE5 game on Friday's video roundup
• They are definitely making a Fortnite movie
• Lots of other weekend tidbits

This week, a number of major companies such as Amazon, Google and Facebook, as well as companies in the food and pharmaceutical sectors such as PepsiCo, Mondelez, Merck and Eli Lilly are among the 180 S&P 500 companies set to report earnings this week, providing investors with an insight into how businesses fared in Q1 of 2023 amid concerns about the US economy, inflation and banking crisis. This comes as Federal Reserve officials signal a possible interest rate increase in early May to combat inflation and tight labor markets, despite a greater likelihood of recession later this year.

Pixel Fold, the foldable phone from Google set to launch later this year, has been shown in a leaked video featuring a book-like design with an external screen and an internal display with noticeable bezels and a visible crease.

Fortnite may get a movie adaptation in the future, according to Donald Mustard, Epic Games' chief creative officer. While there are no active plans at the moment, Mustard said that a Fortnite film would be greenlit by any studio in a second. Epic Games has already invested in the Russo brothers' production company AGBO, so a Fortnite adaptation wouldn't be surprising.

Lyft will lay off about 1,200 people to cut costs and remain competitive with Uber. The company has struggled financially in its attempts to compete with its rival. Lyft's new CEO, David Risher, plans to notify employees next Thursday if they have lost their jobs, and Lyft offices will be closed that day. Mr. Risher said that money saved from the downsizing would be used to "invest in competitive pricing, faster pick-up times and better driver earnings." In November, Lyft laid off 13% of its staff.

• R/GA has made another significant round of layoffs affecting "under 100 employees", although current and former employees suggest that the number could be as high as 120, with the agency declining to comment on the specific percentage. The layoffs impacted across the entire US and were not specific to one department. R/GA had a similar round of cuts in November 2022, which affected 60 employees, following a 5% cut of its New York staff in June. The layoffs come amid a series of executive departures, including CEO Sean Lyons, who is set to join Accenture Song in May. Quote from Adweek:

In December 2022, the agency won the multimillion-dollar Mattress Firm account, but just a week later the business reduced the scope of its work with R/GA, switching to a project-based approach. Since then, Mattress Firm cut ties with the agency. One source told Adweek this was a product of the agency not moving fast enough to staff the business and build a relationship with the client.

• WPP has officially launched its new global design company, Design Bridge and Partners, following the merger of Design Bridge and Superunion last summer. The new company, led by Group CEO John Morris and Chairman Jim Prior, will bring together a network of 850 people globally, operating in 12 markets. The merger has allowed for a more complete range of solutions that span everything from strategy to delivery at every touch point, according to Prior. The company will operate as Design Bridge and Partners, with clients being served collaboratively by the teams from the two former agencies.
• Holding companies are turning to artificial intelligence and offshoring to manage costs and adapt to the future of work as the agency business faces economic uncertainty; Omnicom and Publicis have both used their Q1 earnings reports to discuss their visions of the future of work, while Omnicom is building campuses in India to ramp up its offshore workforce, and Publicis already has 25,000 engineers in India through Sapient and is expanding to Eastern Europe and Latin America.
• Levi Strauss & Co has announced the appointment of Kenny Mitchell as its senior VP and CMO for the Levi's brand. Mitchell was previously the chief marketing officer at Snapchat, where he led various marketing campaigns that positioned Snap. Levi's has been exploring the incorporation of technology in its marketing strategies and has previously faced backlash against its AI-generated models to showcase diversity.

• Microsoft has partnered with McCann NY and West African brothers Ibrahima and Abdoulaye Barry to create a new digitized version of the Pulaar language alphabet, which was created to preserve the Pulaar language of the Fulani people in West Africa. The project is part of a larger cultural preservation and literacy initiative that includes in-classroom materials, a learn-to-write book, and a children's book designed to teach the ADLaM alphabet and elements of the Fulani culture.

• LVMH said during an annual presentation to investors that although the metaverse and NFTs are interesting, LVMH is in no rush to sell virtual products and is more interested in monitoring developments in the space. Arnault sounded a note of caution, comparing the metaverse to the dot com bubble of the early 2000s and suggesting that there could be more relevant applications than selling virtual sneakers for €10, which he contrasted with rival Gucci's bullish approach.
• Humane, the AI-oriented start-up co-founded by former Apple designer Imran Chaudhri, has demonstrated a device that can project phone calls onto the palm of a hand at the annual TED conference. The device's ability to act as an assistant and produce a French translation was also shown. Further details on the device will be released in the coming months.

• Google has paused construction on its Downtown West campus in San Jose, which was set to be a major development for the area. The move is reportedly part of Google's assessment of its real estate investments
• Unrecord is a new first-person shooter video game being developed by Drama Studio using Unreal Engine 5, which creates a unique and incredibly realistic experience. The game uses an optical illusion called Trompe-l'œil to create the impression of a lifelike space recorded as video, and not a scene generated in a game engine.

• Magic Leap collaborated with Audi for the AR feature in its new Activesphere concept car based on the new user interface Audi Dimensions. The car features an immersive and configurable layout with an individually configurable AR view for drivers and passengers. Eye and hand tracking are used to display information virtually while also simulating sensory touch control. The Audi Activesphere can be put into different kinds of applications in-cabin such as displaying road safety information or high-resolution 3D topography.

• IKEA has integrated its entire product catalog, consisting of over 10,000 3D-enabled products, into Google Search for augmented reality viewing. Previously, users could only view the 3D models of IKEA products via the iOS-exclusive IKEA Place app. With the integration, users can search IKEA products on Google and tap the “View in 3D” button to see the 3D model in a plain virtual room or overlay it in their real homes.
• Riot Games President of Esports, John Needham, outlined his vision for the future of competitive gaming in a blog post, acknowledging the difficulties of making profits. Riot Games is looking to help keep the industry afloat by sharing some of its earnings with esports teams in its ecosystem. Needham also discussed Riot's strategy for broadcast rights, its fighting game project "Project L," and the issue of inflated player salaries in esports.

• The Information held its Creator Economy Summit in Los Angeles, where a range of issues impacting social media creators and start-ups were discussed. There was significant debate over TikTok's role, with the platform seen as driving much of the conversation around the creator economy. Start-ups using generative artificial intelligence to shortcut video editing were also discussed, with the need for proprietary data seen as key to their success. The venture capitalists present warned of an impending shakeout in the creator economy sector, with many start-ups expected to fail or face other stresses in the near future due to a collapse in investor appetite.
• Procter & Gamble has reported an increase in quarterly sales & profit as consumers continue to pay higher prices for household items such as Pampers diapers and Tide detergent. P&G raised prices for its various brands by around 10% in the March quarter, which is the second straight quarter of a 10% year-over-year increase. Despite sales volume falling 3% in the March quarter, which is better than expected, P&G expects overall revenue for the fiscal year ending in June to rise.
• Leaked pitch slides and Telegram messages reveal that generative AI startup Stability AI, which raised a $101m Series A round in October 2022, had claimed to have "co-created" products developed by other generative AI firms, including Midjourney, when in fact it had only provided access. Stability's flagship product, DreamStudio, is powered by the open-source AI model Stable Diffusion, which it did not develop or own the IP to. The leak comes as the firm looks to raise a new funding round, amid reports of its struggle to generate revenue.

• Apple's AR/VR headset will feature an external battery that will be placed in the user's pocket and connected to the headset via a cable.
• How does the New York Times make a game?
• Bed Bath & Beyond filed for Chapter 11 bankruptcy protection and plans to close all brick and mortar stores by the end of June.
• Twitter removes “Government-Funded Media” Labels From NPR, PBS, Others After Backlash
• “It’s just mind boggling.” More than 19,000 undersea volcanoes discovered
• Will Apple take a big bite out of the banks?
• The Pixel Tablet has been captured on video at a special Google event
• Alphabet boss Sundar Pichai’s pay rose to $226mn last year
• U.S. Begins Planning for 6G Wireless Communications
• Twitter adds blue checks to accounts of dead celebrities

Nothing is real, act accordingly.

H/T The quiz master himself Justin Cone

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