Hi, Insiders! Hopefully, you're in the midst of a long holiday weekend. But even if you're not, take it easy. After all, whatever it is can probably wait until everyone's back on Wednesday. If you are off, perhaps you flew to a fun location. And if that's the case, you likely booked your flight online. But, as you'll see below, that might not be the great deal you think it is. In today's edition: |
But first, I'm looking for the cheapest option. |
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THE BIG STORY The bummer about online bookings |
The common assumption about purchasing a product is the closer you get to the source, the better the price. Every person or company sitting between you and what you're trying to buy represents a slight increase in price. These middlemen typically include a markup for whatever it is they do, the thinking goes. So when it comes to buying airline tickets, the rise of online bookings allowing users to circumvent travel agents seemed like a massive win for the consumer. Not quite. It turns out that the internet actually screwed up air travel, per a fascinating story from Gad Allon. Empowered by tools like Expedia, Kayak, and Google Flights, customers now typically search for the cheapest options for their trips. Airlines have adjusted accordingly, prioritizing lower ticket prices while cutting costs everywhere else. From less legroom to additional fees for seemingly everything, airlines have pulled out all the stops to be the top result when customers sort their flight options from cheapest to most expensive. Take Ryanair, the Ireland-based budget airline that is perhaps the king of the low-cost, high-fee model. Per a recent search on Google Flights, you can book a direct, roundtrip flight from London to Barcelona for a weekend away in mid-August for only $145. Of course, you won't be able to bring carry-ons with you, and you'll have to fly out of London's Stansted Airport, about an hour's ride on the train from the city center. And you'd better eat your breakfast before you get on the flight, or you might risk getting charged an extra $100. Even those of us willing to shell out a few more bucks for our flights are getting screwed, Gad reported. A research paper examining the effect of the internet on the performance and quality of the airline industry found that the average actual flight time for the same routes increased between 2.6 minutes and 8.2 minutes from 1997 and 2007. |
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TOP READS AWS, Gen Z, and more |
- Young people trying to break into Hollywood amid the writers' strike are losing hope. Job seekers say they're in solidarity with the writers, but they're finding it nearly impossible to find opportunities in Hollywood as most development and production has ground to a halt. One recent grad says she has concerns about her visa application while another plans to apply for food stamps as many 20-somethings are left "doom-scrolling LinkedIn."
- Apple's valuation eclipses $3 trillion. The company briefly hit the mark on an intraday basis in January 2022, but it dropped below the threshold before the stock closed. Now the tech giant's valuation is larger than France's annual GDP.
- Amazon Web Services is in talks for a massive expansion to its contract with the Dutch government. The cloud giant is negotiating with the Dutch Ministry of Justice and Security to up its current $250,000 contract to $85 million over a 5- to 6-year period, according to an internal document obtained by Insider. AWS already passed a key data-privacy test from the Dutch government, but it's expecting another one later this year.
- Gen Z and their chatbots. Young workers are leaning heavily on AI-powered tools for everything from writing emails to researching competitors, and it could spell trouble for the rest of us. "You will not be replaced by AI but by someone who knows what to do with AI," Oded Netzer, a Columbia Business School professor, told Insider.
- Microsoft is going all-in on making cutting-edge AI chips. Developing the silicon chips — considered one of its "needle-moving priorities" — is set to help it cut costs and generate $10 billion in new revenue by 2030. The plan is also part of Microsoft's strategy to "close the gap" with AWS in the public cloud space, Microsoft CEO Satya Nadella wrote in a memo.
- Inside the unraveling of a former darling of the adtech industry. MediaMath intends to file for bankruptcy, marking an end to what was considered a rising star in advertising. The startup, which previously flirted with a $1 billion exit, was plagued with hubris and missed opportunities, insiders said in our tell-all published earlier this year.
- All-you-can-eat buffets are so back. Buffet-style restaurants, which seemed on the brink of extinction amid the pandemic, are back in style with reports of two-hour waits at some establishments in Las Vegas. But it's not just Sin City, as there's been a 125% increase in foot traffic at the buffet restaurants Golden Corral, Cicis, and Pizza Ranch.
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BEFORE THE OPENING BELL Inflation, debt, & Argentina |
- The US could see a big drop in inflation without hitting a recession, Bank of America said. Strategists pointed to the inverted Treasury yield curve, the bond market's notorious recession gauge.
- Ballooning debt could force the Fed to buy massive amounts of bonds again, lifting stocks in the process. That's according to Michael Howell, a managing director at Crossborder Capital.
- Argentina is facing a dire shortage of US dollars. Amid the currency crisis, the country is allowing people to open bank accounts using the Chinese yuan.
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| WHAT ELSE IS GOING ON Russia, Titan sub, & flying cars |
- Russia canceled its premiere international air show because it was afraid nobody would show up, per UK intel. The intel said security concerns were also a factor.
- Photos from the Titan sub's wreckage support a theory the submersible's carbon-fiber hull failed first. The Titan's hull could have given way to the enormous pressure of the ocean depths, according to an expert who analyzed footage and photos.
- A $300,000 electric flying car just won approval for test flights. Alef Aeronautics, a startup backed by SpaceX, is the first to gain such approval for a flight-capable car.
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Steve Jobs with the Lisa computer in 1983. Ted Thai/The LIFE Picture Collection/Getty Images |
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