How Tim Cook's Apple just became the accidental test case in a clash about capitalism

Donald Trump and Apple CEO Tim Cook

Hello readers, and welcome to this week’s edition of Trending,
the newsletter where we highlight BI Prime’s biggest tech stories.
I’m Alexei Oreskovic, Business Insider’s West Coast bureau chief
and global tech editor.

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This week: Apple is the first test case in a clash of philosophies
about capitalism

Tim Cook

The showdown between Tim Cook and the FBI has been framed as a
fight between privacy and security. But it’s also a battle between
two competing philosophies about capitalism.

That became clear after Donald Trump lashed out at Apple on
Tuesday, demanding that Apple “step up to the plate” to help unlock
the iPhones used by the Pensacola, Florida shooter and reminding
Cook that Apple had been spared some of the most painful tariffs.
In other words, do what we ask of you, or your business will
suffer. 

In that sense, what’s developing may be the first real test case
of the
universal stakeholder approach
that is increasingly being
talked up by companies (and is part of
Elizabeth Warren’s platform as well as that of other Democratic
presidential candidates
). Recall that Cook was among the

200 corporate chieftains
who signed a commitment in August
declaring that a corporation’s purpose is not simply to maximize
profits for the benefit of stockholders. Companies also have a
responsibility to serve stakeholders that include employees,
customers and society. 

Given that Cook has declared that privacy is a “fundamental
human right,” this would seem to be an occasion where its
commitment to a key stakeholder (society) is being challenged. But
if Apple digs in and fights, the pain Trump can inflict —

whether through tariffs
in the still unresolved China trade
war, despite today’s Phase One signing, or in some other form —
will undoubtedly hurt the company’s bottom line, and by
consequence, its stockholders.

So who does Cook choose to fight for?

It’s not an unpredictable predicament for a company that takes
an oath to serve different stakeholders, each with different
interests. But I doubt Apple is thrilled to be taking the lead in
settling this emerging debate. The last time Apple was under
pressure to unlock a mass shooter’s iPhone, in 2016, the standoff
was resolved by a third-party company whose tech got the job done.
Tim Cook may not get so lucky this time and his, and the Apple
board’s conduct, will say a lot about how serious these pledges of
corporate responsibility really are.

Time to monetize some Zs

If the future of capitalism is too weighty a topic for you this
early in the year, perhaps you’d prefer the comfort of a cozy
business like mattresses. Lucky for you, Casper filed its paperwork
to go public last week, and
hinted at a variety of future products for its slumbering
customers.

But as Troy Wolverton writes,
all is not well in the sleep economy
. It turns out that selling
mattresses online has one big drawback: Customers don’t know if
they like the feel of the mattress until it arrives at their
doorstep. And for something as personal as a mattress (as Casper
helpfully points out in its S-1, people spend more time sleeping
than any other single activity in their lives), an uncomfortable
product is a deal breaker. 

The situation is so serious that as of September Casper had a
special reserve “cushion” of $11.6 million on hand for customer
returns. For a company that only had $54.6 million of cash on its
balance sheet at that point, that’s not a trivial sum. 

That’s not to say Casper’s business is in trouble. A lot of
people, particularly millennials (and my parents), are big fans of
the company’s buzzy bedding. As we get closer to the IPO, we’ll be
digging deeper into Casper’s efforts to monetize your Zs. In the
meantime, enjoy this amazing chart from Casper’s IPO
prospectus:

casper feedback

 

Read the full story here:
Casper, the buzzy mattress seller adored by millennials, has a
costly returns problem that could be a nightmare for its IPO

It’s a no code world after all…

In case you needed any more evidence of the popularity of
low-code/no-code tools, Google’s acquisition of AppSheet this week
should make  it clear that this is one of the hottest areas in
tech right now. 

Appsheet is among the new class of tools that allow companies to
create apps without having to keep an engineering department on the
payroll. We highlighted another standout in this field last year
when we included
the founders of Airtable among BI’s 100 People Transforming
Business
.

As Paayal Zaveri writes, the trend to no-code/low-code is being
driven by
an increasingly automated world and a shortage of developers
.
Some industry estimates predict the market will be worth $52
billion by 2024.

Microsoft is well positioned for this landscape, thanks to its
little known Power Platform product line, Paayal writes. So too are
public companies like SmartSheet, and a slew of specialized
startups which may find themselves fielding a lot inbound
acquisition interest this year. 

Satya Nadella

Read the full story here:
A shortage of developers is going to lead to a boom in tools that
help make simple apps without coding, and Microsoft stands to
benefit, analyst says
Here are some other tech highlights:


What experts expect from Oracle in 2020: Leadership changes in the
Safra Catz era and tougher challenges in the cloud


Here are all the companies Airbnb has acquired to help it grow into
a $31 billion business


YouTube’s big changes to ads on children’s content is hitting
creator revenue by as much as 50%, says a CEO who helps manage
4,300 channels


The COO of GitHub explains why it has no plans to ever move
completely to Microsoft’s cloud, over a year after the $7.5 billion
acquisition


Amazon is testing a new shopping feature that shows customer
reviews from other countries — but it ignores the big problem
with user reviews

And more big stories from across the BI newsroom:


Jeffrey Epstein set Elon Musk’s brother up with a girlfriend in
effort to get close to the Tesla founder, sources say


These are the top 21 clean-tech startups to watch that are set to
transform the energy industry


KPMG’s new $450 million training center gives 800 employees access
to free food from 8 different kitchens, a wine bar, and over 44
miles of bike paths. Here’s an exclusive look inside.


We asked 9 of the most prominent VC investors in European tech to
pick out fintech startups they think will blow up in 2020. Here are
the 15 they chose.

Thanks for reading, and remember, if you like this
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— Alexei


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Source: FS – All – Economy – News
How Tim Cook's Apple just became the accidental test case in a clash about capitalism