Talibs Weekly Email - Week 42
🖥️ The Rise of Microsoft, 🗳️ The right to vote in Florida & 🇨🇦 Framing Canada
Good Evening,
Hope everyone had a great week and are gearing up for a very interesting week ahead with the US elections hopefully coming to a close (hopefully).
Again - appreciate all the articles/podcasts recommendations
If you’re looking to listen to a unique conversation between two interesting thought leaders; take a listen at Naval & Tims chat on the latest Tim Ferris Pod. (Thanks Rishi for the Naval Twitter feed)
Talib
What I’m listening to as I write this weeks email
Tweet that got me thinking
🖥️ Economist: How Satya Nadella Turned Microsoft Around
🗳️Planet Money: Who gets to Vote in Florida?
Articles
🖥️ Economist: How Satya Nadella Turned Microsoft Around
TLDR: Satya Nadella took charge in 2014 and re-strategized and re-organized the entire organization and invested heavily into the Azure even after AWS had significant market share.
🔥How has Microsoft fared recently?
⌨️ What was the issue before? Until 2014; Microsoft had 5 different business areas.
Windows $$$
Office Software (MS Office and the power of “Excel”) $$$
Programs to run servers in data centres and corporate networks $$$
Entertainment & Devices (Xbox) $
Online Services (Microsoft Bing/MSN) $
Most of the profit comes from the top 3 (Windows, Office and Programs)
Today - they’ve transformed the entire company so that Microsofts’ 20 or so businesses fall into three buckets: cloud, productivity software and business processes, and personal computing. Each contains one of the lucrative stalwarts—servers, Office and Windows.
💾 Innovation at Microsoft? History indicates that Microsoft has succeeded by commercializing existing products than inventing then. They’re often never first to market but they do know how to make a buck. (Xbox after PS; Azure after AWS)
👆MS Excel: Excel was not the first spreadsheet document (LOTUS was) but it could possibly go down as one of the most consequential program ever written mainly due to its wide adoption across all industries. Around 1.2 bn workers use Office as Microsoft controls 88% of the market (The google suite accounts for 11.5%)
🙏MS Teams: Teams was formed after the innovation of Slack and recently, Microsoft has started bundling it with Office 365 free of charge. Slack has launched an anti-trust suit against Microsoft just as Internet Explorer destroyed Netscape; which led to the anti-trust suit in the 90s.
☁️ MS Azure: This is the big one; Azure was formed after AWS had successfully launched and was gaining adoption. The share of spending going to cloud is approaching 10% which accounts for its annual cloud market of $240 billion; annual growth rates are estimated at 20% and this market could be a trillion dollar opportunity soon enough
🔼 Sales: Microsoft’s rapport with IT departments has allowed it to gain insider access to quick feedback and access to present their suite of products. They can offer a single price that bundles Azure with office and other software; that way Azure can end up being significantly cheaper than AWS.
🙏Technical: The Azure product is technically inferior to AWS. Microsoft has built its global cloud infrastructure which allows it to cover more geographical area but reliability of the product has suffered. As demand has surged during the Pandemic; Azure has had its fair share of issues recently.
👆The Stock Price: Wall Street has all their eyes on Azure; it is what drives Microsofts share price. Azure is estimated to make only 1/10 of Microsofts $53bn annual profit but the focus on Wall Street has been perpetuated on the growth of Azure.
⏭️ The Future: Azure is bound to get an increase in adoption with a new set of licensing rules. Up to last year, Microsoft allowed its customers to use its software on dedicated servers run by AWS or Google. The Microsoft software suite is quite good and many companies have their cloud on AWS but utilize a Microsoft software to get the best out of both companies. This is a practice known as BYOL (Bring Your own licence) and AWS/Google tout this publicly as a selling point.
🚫 Say No: Microsoft implemented a new policy that ended the ability for AWS and Google to provide their customers with a way to bring in existing Microsoft enterprise software licences. Hence, this creates a dilemma with the existing consumers to switch entirely to the Azure product. Microsoft is the only big cloud provider which also sells lots of programs that clouds host.
💭My Thoughts: Microsoft is a prime example of a company that continues to innovate and follow the trends. The diversification into the variety of different industries allow them to place multiple bets in different ways and expand their offering around the web. The Azure licensing rules are quite a risk but I would think that they have cost-benefitted to the fact that they make lose a significant amount of consumers but would gain some higher $$ value customers when a smaller portion of them transfer their entire services to Azure.
🌞NPR Planet Money: Who gets to Vote in Florida?
🏖️What about Florida? A few years ago, If you had a felony conviction in Florida; you would lose your voting rights, your right to sit on a jury and your right to run for public office for life. The only one one would get those rights if they were granted clemency by the Governor and that has rarely happened.
🌞How did this start? The term is called “Disenfranchisement” which essentially means being deprived of a right or privilege, especially the right to vote
This started all the way back to the civil war; the 14th amendment granted citizenship to newly free slaves however it also mentioned that you can take away the vote from one group of people, people with criminal convictions. In 1868, Florida did just that.
🚨How many people are convicted? There are about 1.4 million people with felony convictions in Florida, 1 in 10 adults with a felony conviction, more than 1 in 5 African Americans.
🗳️Why is Florida so important? Florida is a state that can swing presidential elections, like the one happening just next week. And elections in Florida usually come down to much less than even a million people. Hillary Clinton lost Florida in 2016 by 112,000 votes. In 2000, George Bush won by just 537.
✍️Has anyone tried to change this law? This law has been changed a few times; Governor Crist granted some voting rights but the next Governor (Rick Scott) immediately rescinded the law. The other way was to amend the constitution and this is a very difficult task for any group to undertake.
To get an amendment on the ballot requires over 1 million signatures; once that is done - they need to have a 60% vote ( supermajority). Hence, this amendment requires bi-partisan support.
2017: This amendment gathers over 1 million signatures and in 2017 - it passes. That is a big deal for many and immediately allows voting rights for people with criminal convictions. Nearly 65% of Floridian voters give back the vote to 1.4 million people. This is the largest addition to the voting rolls since women got the right to the vote in 1920.
🧑⚖️January 2019: The amendment is ratified in 2019 and looks like this would be perfect and right in time for the 2020 election.
💰March 2019, Not so fast: The Florida state legislature decides on how to implement this amendment and they start questioning the words in the amendment. They claim the words are a little vague; For example.
“the amendment says you don't get your vote back if you were convicted of murder” Does this include second degree murder? What about felony?
"people with felony convictions can vote only after they complete, quote, all terms of their sentence." What exactly is the meaning of all terms of sentence? It would appear that this means just finishing your prison time but quite a few sentences also come with financial obligations such as restitutions, fines and a whole set of administrative fees.
And fees aren't so much about punishment like the other financial obligations. Fees are mostly there to basically just fund the government. Only some people have to pay those first two things, restitution and fines, but every person with a conviction owes fees.
The state argues and concludes that if you want to vote - you have to pay off everything including fees and this law passes in June 2019. Nearly 80% of the people who owe money just cannot afford to pay it back.
🆘 Advocacy groups: Groups start popping up and start raising money from Lebron James, Michael Jordan and others. They raise $25 million and just start paying peoples fees off - Here comes another obstacle !
😡 Obstacle 2: There are 67 different court systems in Florida that have financial records and those systems are not integrated - And you're going to want to be very sure you don't owe money before you vote because if you even register to vote when you aren't eligible - say, if you owe money and you didn't realize it - in Florida..that is a felony. (irony)
⚖️When Amendment 4 first passed, they thought about 1.4 million people would gain the right to vote, and that number got cut to just over 600,000 by the new law. And by the voter registration deadline this fall, only about 85,000 people of that original 1.4 million had registered.
🇨🇦 What about in Canada? The Supreme Court of Canada has held that even if a Canadian citizen has committed a criminal offence and is incarcerated, they retain the constitutional right to vote. In the 2015 federal election, more than 22,000 inmates in federal correctional institutes were eligible to vote.
💭My Thoughts: This is an example of systematic voter suppression that has been evident in the constitution for over 150 years. It is encouraging to see change happening slowly and gaining momentum over time. It is a sad story that out of a possible 1.4 million new voters; only 85K have registered to vote.
⛑️ What is this all about? Many Americans growing up the 90s were often swayed away from the Canadian healthcare type system as attack ads were drilled by lobbyists that
“Canadians waited forever to go see a doctor”
“Canadians can’t get the treatments that they needed”
"Canadians die in hallways of hospitals waiting for treatments”
😡These were common ads that were pushed by groups that represented hospitals, insurance providers and Big Pharma that feared that if a system evolved that resembled the single-payer system that exists in Canada would take stage - their entire business model would fail.
💰Cigna Insurance: This pod talks to Wendall Potter who was the head of the PR Department at Cigna Health Insurance. Cigna Health Insurance trades on the NYSE with a $67 billion market cap and recently made $157 billion in revenues in 2019. Wendall was on the forefront of these attack ads in the 90s and now he’s known as the whistleblower in the industry.
📢When did this start? This started in the 90s when George Bush Sr was President at the time and he was running for re-election against Bill Clinton. Bush was not thrilled with the democratic plan to revitalize healthcare and began comparing the democratic plan to Canada’s healthcare plan. He kept re-iterating “socialized medicine” and we’re quite aware of how much Americans dislike the word “socialist”
What the Clintons were proposing wasn't actually a Canadian-style system. It had a few elements of it but was far from it.
🏥The joint council: During this election cycle, the hospitals didn’t like part of the plan, drug companies hated a certain part as well and insurance companies didn’t like another part of the plan. They all got together - threw a bunch of money into once place and created the “Health Care Leadership Council”
“You know, set aside all grievances and unite against this common enemy”
🔊FUD campaign: Fear Uncertainty and Doubt (FUD) campaigns are campaigns that don’t have to prove anything; they just have to make someone else’s idea seem dangerous. We’ve seen this in many of the political campaigns over the years; at times - it becomes 100% of the political campaign.
This campaign worked in the 90s and health care plans were tabled for the time being.
🗳️ Until Barack Obama: The US economy has been shaky and Barack Obama rises to prominence and starts talking about vitalizing healthcare. Cigna Insurance conducts various internal polls and showed that majority of Americans were favorable to the idea of a Canadian style healthcare and that was terrifying for insurance providers.
🤝Joint Strategy: Lobbyists began to form in masses and began circulating binders of “selective statistics” to insurance providers and their PR Teams. This was to ensure that every insurance provider was talking the same points at all times; these talking points were all against Canada
You want to make people believe that because Canadians might wait several weeks or a few months to get a knee replacement, that's indicative of everything in Canada. People are having to wait for everything.
Statistics about X-ray machines being out-dated in Canada
The cumulative picture is that the Canadian system is lousy, expensive and even dangerous.
Overall - the US never got to a single payer system and instead currently have the affordable care act but apparently “socialized” medicine in Canada is at fault.
💭My Thoughts: I was recently watching Sunday football on CBS Chicago (IPTV) and I was barraged with continuous ads for 4 minutes during a commercial break. There were no products or substantive ads. All these ads were FUD related and it was quite heavy at times. If I saw ads that showcased over-worked doctors, patients dying in hallways or long wait times - I’m sure people could easily get swayed into a private healthcare system. The Canadian health care has its faults but the fact that my healthcare is not dependent on my employer is essential especially during a time like this.
Books of 2020
Here are my books to read/finish for the next while
Tanking to the Top - Yaron Weltzman (Philadelphia 76ers “The Process”)
Completed
Educated by Tara Westover (9/10)
Loonshots by Safia Bahchall (8/10)
Range - David Epstein (7/10)
American Dirt by Jeannine Cummings (9/10) [fiction]
We The North - Doug Smith (8/10) - Nice history from a Raptors beat writer
If you’re looking for books to get, I would suggest checking out bookdepository.com or thriftbooks.com (both are cheaper than amazon at time