| | | | | April 12, 2019 | | Good morning. Jeff Bezos sent his annual letter to Amazon shareholders this year, and Fortune's Chris Morris summarized four key themes: – Antitrust scrutiny is a looming threat. Bezos didn't mention it directly, but he starts his letter with a chart showing the rise in the percentage of goods sold on Amazon by independent third parties—it has gone from 3% in 1999, to 58% in 2018. "Third-party sellers are kicking our first party butt. Badly," Bezos wrote. No antitrust case here! – Amazon is headed for failures. The company experiments all the time, and some of these experiments are going to be big failures. "If the size of your failures isn't growing, you're not going to be inventing at a size that can actually move the needle." He didn't single out any one of the company's big bets, but I still have some questions about Whole Foods. – Worker pay needs to rise. After raising his workers' minimum to $15 an hour, Bezos challenged other retailers to do the same. "Today, I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage. Do it! Better yet, go to $16 and throw the gauntlet back at us." – More brick and mortar to come. Bezos highlighted the company's brick and mortar stores that do away with checkout lines. "The reward has been the response from customers, who've described the experience of shopping at Amazon Go as 'magical'." The company now has ten stores in Chicago, San Francisco and Seattle. Expect more to come. And since it is Friday, I'll share feedback from the very thoughtful SK, who believes I was too flip on Monday in tying President Donald Trump's Fed nominees to "a president whose modus operandi is to undermine anything he sees as a threat:" "Putting pro-growth and small business-sensitive voices into the Fed discussion is a positive move," SK writes. Fair enough—and I have no particular problem with the monetary policy views of Steven Moore, who I have known for many years, or Herman Cain. But I do think President Trump sees a recession as possibly the biggest threat standing in the way of his reelection, and therefore is giving Fed Chairman Powell the same treatment he previously aimed at Robert Mueller, Jeff Sessions, the CIA, the FBI, the federal courts, etc. More news below. | | | | | | | | Tesla Brakes Tesla has stopped selling its $35,000 Model 3 online, for now. Customers can still buy it by phone or in one of Tesla's not-shut-after-all stores, but not via the web. According to Tesla, this is to "better optimize cost, minimize complexity and streamline operations." In other words, the cheapest version of its sedan is hurting its wallet. More bad news: Tesla's financial situation has reportedly led to the freezing of its battery co-production plans with Panasonic. Wall Street Journal Falcon Soars Speaking of Elon Musk's companies, SpaceX successfully used its Falcon Heavy—the world's most powerful rocket in operation—for a commercial launch, sending a satellite into orbit. What's more, all three 16-storey boosters came back down as planned. New York Times Disney Streams Disney's long-awaited streaming service opens its doors in the U.S. today, costing $6.99 a month. It features separate sections for major brands in the Disney portfolio, such as Marvel, Pixar and Star Wars. It may take a while for all Disney's movies to be added, though, as some are still subject to deals with now-rivals such as Netflix. TechCrunch Uber Warns Uber's IPO filings warn investors that the company "may not achieve profitability." Its most recent annual sales were up to $11.2 billion and its losses down to $3 billion (still an eye-watering figure,) but Uber said it expects to shell out way more in operating expenses. It still hasn't priced its shares. BBC | | . | | | | | | What is the Future of Work in Government? | | While technology continues to transform the way we work, the public sector is beginning to reimagine how work gets done. Deloitte explores how the future of work in government is unfolding. | | Read More | | | . | | | | | | | | | Boeing Altitude Boeing issued a legal document before last month's Ethiopian Airlines crash that said its 737 Max can't be used at "high/hot" airports—such as the airport from which that doomed flight took off. It's unlikely that that caused the crash, but it may have degraded the plane's performance. Bloomberg Contactless Payments Contactless payments are slowly becoming a thing in the U.S., way behind everyone else. Why the lag? The U.S. banking market is unusually fragmented, for one thing, and retailers there are only just getting used to chip-and-pin payments, which have been available most other places for many, many years now. CNBC WikiLeaks Arrest Following Julian Assange's double-arrest yesterday, an alleged associate has been arrested while trying to leave Ecuador, the country that pulled Assange's diplomatic immunity. The individual was reportedly arrested for conspiring against the Ecuadorian government. Irish Times Hollywood Battle A long-running battle over compensation and conflicts of interest may see TV and film writers fire their agents tomorrow, unless there's a resolution. The latest news here is that the talent agencies have offered to share part of the contentious "packaging fees" that they collect with writers. Let's see if that settles the issue. Fortune This edition of CEO Daily was edited by David Meyer. Find previous editions here, and sign up for other Fortune newsletters here. | | | | | | | This message has been sent to you because you are currently subscribed to The CEO Daily
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