Start Up No.1846: TikTok’s victory, Apple’s case against phone cases, werewolf erotica gigwork, Intel wins MediaTek deal, and more

During last week’s heatwave, a blackout was only averted in London by buying electricity from Belgium at eyewatering prices. CC-licensed photo by Eduardo Zárate on Flickr.

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A selection of 9 links for you. How much again? I’m @charlesarthur on Twitter. Observations and links welcome.

How London paid a record price to dodge a blackout • Bloomberg via The Washington Post

Javier Blas:


Last week, unbeknown to many outside the power industry, parts of London came remarkably close to a blackout — even as it was recovering from the hottest day in British history. On July 20, surging electricity demand collided with a bottleneck in the grid, leaving the eastern part of the British capital briefly short of power. Only by paying a record high £9,724.54 (about $11,685) per megawatt hour — more than 5,000% higher than the typical price — did the UK avoid homes and businesses going dark. That was the nosebleed cost to persuade Belgium to crank up ageing electricity plants to send energy across the English Channel.

The crisis, which quietly played out within the control room of the British electricity system, shows the growing vulnerability of energy transportation networks — power grids and gas and oil pipelines — across much of the industrialized world after years of low investment and not-in-my-backyard opposition.

On most days, the bottlenecks mean distorted costs. Sometimes, it results in sky-high prices where energy is in short supply when it is needed. At other occasions, prices can tumble to zero, or go negative, when producers cannot sell their power into a congested transmission system. Increasingly, it puts the whole system at risk. Talk to most industry executives and you quickly get the sense that we are sleepwalking into more blackouts. Discuss the problems with the engineers who manage the system day-in, day-out, and that danger appears even closer.

The £9,724.54 price, settled between noon and 1:00 p.m. on July 20 via the so-called NEMO interconnector that links the UK with Belgium, was the highest Britain has ever paid to import electricity, nearly five times higher than the previous record. The absurdity of that level is apparent when comparing it with the year-to-date average for UK spot electricity: £178 per megawatt hour.

“It was an absolute shock,” says Phil Hewitt, who has been monitoring electricity prices for over two decades and is now executive director of EnAppSys Ltd, a consultancy. “It was the price to keep the lights on. The security of supply was at stake.”

The actual amount of electricity bought at the record price was tiny: enough to supply just eight houses for a year. More power was bought at slightly lower prices. The payments, nonetheless, highlight desperation: buying across the channel was, for 60 minutes or so, the only option to balance the system.


The supply exists, but there hasn’t been enough investment in the grid. In its way, the same story as Texas. And it’s going to get worse.
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Apple politely explains why iPhone cases are a waste of money • ZDNet

Chris Matyszczyk:


Have you ever seen an Apple executive wrap their iPhone in a case? No, you haven’t. But even that example hasn’t been sufficient. So the company has now released an ad, surely intended to help you wean yourself off your unaesthetic, anti-aesthetic behavior.

An iPhone 13 is perched on the edge of a table. It has no case. It begins to ring.

You know what happens when an iPhone that’s lying on a hard surface rings on vibrate, don’t you? It vibrates. It begins to move. Just like a salad spinner if you leave it spinning on your kitchen countertop.

Here, though, you know what’s about to happen. The portentous music helps you along.

Down goes the iPhone.

Do we see what state it’s in once it hits the floor? We don’t. But we do hear it keeps on ringing, so we have to infer nothing untoward has happened.

“iPhone 13 with Ceramic Shield. Tougher than any smartphone glass. Relax, it’s iPhone,” says Apple.

You see? Apple is sending you a message. Take off your cloaks. Be not afraid. Remove your veil and live to the fullest.

If only you could relax enough to add a tiny amount to this world’s beauty. To counteract all its ugliness, you understand.


Haven’t used a case for years and years. Have dropped it, and the glass is slightly cracked. So put a protector on the glass. Slightly cracked that. Life goes on.
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A goldmine of flubbing bloopers • The Guardian

Rick Burin on the DVDs that are floating around, samizdat-like, of early film stars fluffing their lines:


[Humphrey] Bogart and George Brent seem prickly and short-tempered, while [James] Cagney laughs off his mistakes. Pat O’Brien appears to enjoy slipping up: whether he’s forgetting dialogue, choking on a drink, or pulling off his own hairpiece during a fight. [Bette] Davis, meanwhile, is engaged in a running battle with the wardrobe department. She trips over her costume, complains she can’t move her head without her wig falling off and spoils an otherwise exemplary take by becoming caught on a co-star’s buttonhole. Edward G Robinson, so frequently cast as a pitiless gangster, looks most affable, often grinning widely after a gaffe.

“The Breakdown reels are a very insightful view into the overall spirit of Warner Bros in its formative years,” says Warner’s George Feltenstein. “No other studio could let their hair down and have a little fun at their own expense the way this company did.”

Much of the material is extraordinary. There’s Gary Cooper breaking off from his Oscar-winning performance in Sergeant York to wonder, “That’s sure some accent I’ve got,” and Carole Lombard destroying the delicate artifice of cinema as she sits down to a supposedly sumptuous screen meal. “The food’s too tough to cut,” she says, laughing, “and it’s not warm.”


Some of these clips are floating around on Twitter: here’s a quick collection, in a tweet..
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Inside the global gig economy of werewolf erotica • Rest of World

Viola Zhou and Meaghan Tobin:


Georgina Boyes-Macintosh loves to read. The mother of four from New Zealand recently raced through a steamy romance novel series about love and betrayal among a territorial pack of werewolves in the pine forests of the American West. But she couldn’t just pop into Whitcoulls, the local bookstore chain, to find out what happened to the protagonist’s secret baby with her unfaithful werewolf ex-husband. She could only access the next installment by spending coins earned on the Asia-based social reading app Dreame, where new chapters arrive weekly. “I read as a form of escapism from reality,” Boyes-Macintosh told Rest of World.

The central characters of many of Dreame’s most beloved werewolf novels often inhabit Americanized settings, but the authors don’t typically live in the U.S. Rather, they come from countries like Mexico, the Philippines, Nigeria, and China – and often write novels in their second or third language. One student in Bangladesh, who writes under the pen name Anamika, spends five hours a day, seven days per week writing romance novels. She ends each chapter with a cliffhanger to keep readers hooked. Each book earns her up to $300, along with adoring messages from Western fans. “They are very sweet,” she said. “Their comments are my encouragement.” 

The emerging web novel industry spans the globe, taking a business model from Asia, assembling a global supply chain of authors in lower-income countries, and paying them to churn out thousands of words a day for English-speaking readers in the West. Rest of World spoke to four current and former employees at these platforms, who described how the art of novel writing is broken down into a formula to be followed: take a popular theme like werewolves, sprinkle it with certain tropes like a forbidden romance, and write as many chapters as you can. Some novels have hundreds of chapters, most ending on a cliffhanger to keep readers engaged and eager to read on.


Very Dickensian – literally: he wrote his books in serialised chapters, often leaving cliffhangers to ensure readers would come back for more. If he’d been smart enough to include a werewolf or two, who knows how widely he might be remembered now.
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TikTok won • Garbage Day

Ryan Broderick:


over the weekend, Meta’s war on TikTok was taken a step further. The Verge reported that public Instagram content will be “remixable” by default. Public photos on the app can be pulled seamlessly into Reels. It’s obvious that this is Meta’s attempt at competing with TikTok’s fairly revolutionary “duet” feature, which allows videos to be pulled into other videos, like you would a quote tweet or a reblog. But the fact that Instagram has set remixes as the default is already causing chaos on the app. Photographers, in particular, are not happy about this, but the feature also seems tailor-made to abuse and harass people. One person told me they’ve already seen the feature being used to populate a catfish account.

Meta seems to have correctly identified what people like about TikTok — short-form videos, remixable video and audio editing tools that works on mobile, and creators that make stuff rather than influence things — but they’re still trying to jam those features into an ecosystem that wasn’t built for them. Namely, Meta doesn’t have an app that anyone makes stuff for anymore. Not in a way that could meaningfully compete with TikTok’s completely democratized and seemingly-infinite army of (unpaid) creators who are ready and willing to jump on whatever’s trending.

In fact, let’s play a little thought experiment. If you wanted to take out your phone and either snap a picture or record a video and have it be seen by as many people as humanly possible, where would you upload it? Depending on how you use the internet, I’m sure there’s a couple of apps that just cycled through your head. But I’m going to guess Facebook was not anywhere near the top of that list. And I’m going to guess that if Instagram was on that list, it’s not nearly as high up on it as it would have been if we had done that experiment three or four years ago.


The new Instagram layout is not popular. Kylie Jenner, who in 2018 knocked a $1bn hole in Snapchat’s value by complaining she didn’t like its new design, has complained on Instagram: “Make Instagram Instagram again. Stop trying to be TikTok I just want to see cut photos of my friends, Sincerely Everyone. PLEASEEEEEE”. Ignore her at your peril, Zuckerberg.
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How crypto is evolving the future of books and publishing • Esquire

Elle Griffin:


What if you could own a stake in Harry Potter?

What if the book series functioned like a publicly traded company where individuals could “buy stock” in it, and as the franchise grows, those “stocks” become more valuable? If this were the case, someone who purchased just three% of Harry Potter back when there was only one book would be a billionaire now.

Just imagine how that would affect the reading experience. Suddenly a trip to Barnes & Noble becomes an investment opportunity. Early readers could spot “the next big thing” and make a $100 contribution that becomes $10,000 or even $100,000 if the book’s popularity grows. If readers could own a percentage of the franchise, they might then be incentivized to help that book succeed. They could start a TikTok account to promote the book via BookTok, or use their talents as filmmakers to adapt it to the screen. All of this stands to increase the value of their original investment.

“Imagine when all of an author’s readers can suddenly make money as well,” says ​​Margarita Guerrero, head of partner and publishing relations at the publishing startup Readl. “How much more would they be engaged?”

This is the future an emerging number of publishing startups are after—aiming to change the value of a book from a $10 Amazon purchase to a $100 investment opportunity, while creating a market of readers excited to see the books they love succeed.

It might not work—finding readers (and investors) will be a challenge—but if they succeed, their vision could bode very well for the author who, in this scenario, could retain a percentage ownership of these “stocks” and earn value alongside their investors—just like Jeff Bezos retains a percentage of Amazon stock and grows richer as his company’s shares gain value.


“Finding readers (and investors) will be a challenge”? In the words of the famous recipe for hare stew, “first, catch your hare“. These pipe dreams for crypto are just barking. If you wrote the next Harry Potter, you wouldn’t want people on your coattails (JK Rowling’s agent excepted, on 15% probably).

It’s just mad. You can already write fan fiction, and ask for donations. Or publish an ebook on Amazon. All simple. Not the hackable madness of “web3”.
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Intel’s turnaround and US chipmaking get a boost with MediaTek deal • CNET

Stephen Shankland:


Intel has signed up Taiwanese smartphone chip designer MediaTek as a major ally in its effort to reclaim its chipmaking leadership and ultimately restore the United States’ processor manufacturing prowess.

The partnership, revealed Monday, is important for the establishment of Intel Foundry Services, an effort to dramatically expand and transform Intel’s chipmaking business by making chips for other companies. Intel lost its lead with years of manufacturing problems that stalled it during the ascent of two Asian foundries, Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung.

“MediaTek has been a close partner with TSMC, so it is a pretty big deal,” Tirias Research analyst Kevin Krewell said of Intel’s MediaTek partnership.

The deal comes at an opportune time for Intel. It could help draw attention to the importance of US semiconductor manufacturing, the issue at the heart of the $52bn in CHIPS Act spending that Intel is trying to persuade Congress to pass. Intel has been lobbying for the subsidies, postponing a groundbreaking ceremony for a new Ohio manufacturing site where Intel is investing at least $20bn.


Interesting win for Intel. Maybe we should coin a phrase, like “chips are the new oil” or something. Talking of which…
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Computer chip shortage hits Detroit • The Washington Post

Jeanne Whalen:


Detroit’s experience shows how thoroughly the nearly two-year-old semiconductor shortage has upended manufacturing — and foisted change on one of America’s most beloved consumer markets.

…Gone are the days when buyers could drop in on a dealership and drive home in a cherry-red convertible packed with their favorite features. Buying a car now means placing an order and waiting, sometimes for months, for the vehicle to arrive.

Also gone are the days when buyers could count on finding affordable wheels. The average U.S. list price for a new car has risen by 20% over the past two years, to $45,975, according to data provider Cox Automotive. The average for a used car has soared even more — by 40%, to $28,012.

Those spikes have been a major factor fueling inflation, which hit a 40-year high last month. A new car is increasingly “a luxury product for wealthy people,” said Charlie Chesbrough, senior economist at Cox Automotive. “For a $60,000- or $70,000-a-year household, you can’t afford a new car payment.”

The global auto industry produced 8.2 million fewer vehicles last year than it would have without the chip shortage, according to the consulting firm AlixPartners. And the outlook for 2022 remains bleak, with automakers projected to sell just 14.4 million new cars in the United States, down from roughly 17 million in 2019.

…When an automaker is missing one piece of the puzzle, it can suddenly halt production and force dozens of suppliers to idle their factories, leaving everyone frustrated, said Thomas Kowal, president of Seraph, a global consulting firm with Troy, Mich., offices that have been busy advising carmakers and suppliers how to navigate the shortages.

An automaker might suddenly tell suppliers, “Hey, we don’t need to run production on Friday,” Kowal said. Then on Saturday it might demand that suppliers haul their workers in to churn out parts over the weekend. “It’s like it’s a yo-yo, constantly,” Kowal said.


Wonder if that, plus the spike in fuel prices, will hurry the shift to EVs. No indication from anyone interviewed in the story – but Tesla was the only carmaker to sell more this past quarter.
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Eutelsat shares tumble after confirming OneWeb deal talks • Financial Times

Leila Abboud, Peggy Hollinger, Arash Massoudi and Harriet Agnew:


French satellite operator Eutelsat has confirmed it is in discussions to acquire smaller rival OneWeb in an all-share deal designed to help the groups challenge billionaire space entrepreneurs Elon Musk and Jeff Bezos.

Under the terms being discussed, the OneWeb and Eutelsat tie-up is being branded as a merger of equals with each set of shareholders ending up with 50% of the combined company. OneWeb shareholders would tender their shares to Eutelsat in exchange for Eutelsat shares.

Eutelsat’s share price tumbled more than 17% to close at €8.57 on Monday as investors balked at the prospect of a deal.

If completed, the combination would address Eutelsat’s need for growth to offset a declining satellite video business and OneWeb’s requirement for $2bn to $3bn in investment to complete its network and update its technology, according to people close to the talks.

“The transaction would represent a logical next step in the successful partnership between Eutelsat and OneWeb,” said Eutelsat, which bought a 23% stake in OneWeb in 2021.

But Markus Kaussen, an analyst at Swiss asset manager BWM, which is a top-15 shareholder in Eutelsat, said a deal would “turn the investment case [for Eutelsat] 180 degrees”.

“Right now, it is a boring value stock for income-oriented investors with high free cash flow and high dividends,” he said. “If it were to merge with OneWeb, it would become a growth business hoping that an expensive bet will pay off in the future, rather than an established business with known economics.”


Poor OneWeb: nobody loves it, possibly not even its own people. But a 50-50 structure won’t work. I once worked for Business magazine, a joint venture between Conde Nast and the Financial Times, two very different publishers. It was calamitous: any success was bitterly claimed, and any failure blamed on the other side. It failed. There’s a reason analysts shake their heads at the phrase “joint venture”.
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• Why do social networks drive us a little mad?
• Why does angry content seem to dominate what we see?
• How much of a role do algorithms play in affecting what we see and do online?
• What can we do about it?
• Did Facebook have any inkling of what was coming in Myanmar in 2016?

Read Social Warming, my latest book, and find answers – and more.

Errata, corrigenda and ai no corrida: none notified

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