On The Rock
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AI is still in its early stages of adoption, but it is moving fast and has the potential to impact every industry. Top Tech companies are investing and developing the hardware, LLM operators are building the language models, hyperscalers are making AI available to businesses, and cloud infrastructure companies are providing the tools to build and deploy AI applications.
Experts believe that AI is poised to revolutionize every industry in the coming years, automating tasks, improving decision-making, and creating new products and services. For example, AI is already being used to develop self-driving cars, new medical treatments, and new forms of entertainment.
Top Tech
Microsoft
Microsoft is strategically focused on translating the hype around AI into tangible tools. Headed by Chris Young, Microsoft's corporate strategy leader, the company has invested $13 billion in ChatGPT maker OpenAI and continues to allocate resources to build and upgrade its cloud infrastructure for AI.
Young oversees Microsoft's venture investment arm M12, which engages in early-stage startup investments. While AI adoption has gained traction in certain sectors, including sports leagues and pharmaceutical companies, Young emphasizes the need for widespread adoption to fully realize the potential of AI (i.e., Microsoft's staple offerings like Windows and Excel).
Nvidia
Nvidia NVDA 0.00%↑ is developing a new series of AI chips tailored for the Chinese market in response to tightening U.S. regulations for the second time. The semiconductor giant seeks to maintain its foothold in China while adhering to evolving restrictions. Following U.S. restrictions that halted Nvidia's previous chip exports to China, the company has informed Chinese distributors about three new chips expected to be available by year-end. These chips comply with U.S. rules, marking Nvidia's second adaptation to U.S.-imposed restrictions.
The U.S. has been tightening regulations on AI chip exports to China due to concerns about their potential use in cyberwarfare, espionage, and military applications. Nvidia's new chips, named H20, L20, and L2, are designed to stay below specified performance thresholds, ensuring compliance with U.S. export regulations. The move reflects the challenges faced by the global chip industry amidst changing geopolitical dynamics and regulatory landscapes.
Google
Google GOOGL 0.00%↑ is reportedly in discussions to invest hundreds of millions of dollars in Character.AI, a rapidly growing AI chatbot startup, according to sources familiar with the matter. The potential investment, potentially structured as convertible notes, aims to support Character.AI in training models and meeting escalating user demand. Character.AI, founded by former Google employees Noam Shazeer and Daniel De Freitas, currently collaborates with Google, utilizing its cloud services and tensor processing units for model training.
The chatbot platform enables users to interact with virtual versions of celebrities and create their own chatbots and AI assistants. The investment would deepen the existing partnership between Google and Character.AI. The talks are ongoing, and deal terms may change, with Character.AI also exploring equity funding from venture capital investors that could value the company at over $5 billion. This potential investment aligns with Google's strategy of supporting AI startups, following its recent investments in the sector.
Sports
YouTube's Impact on NFL Sunday Ticket: Antenna estimates that 1.3 million consumers subscribed to the NFL’s Sunday Ticket package through YouTube by the end of September. The report indicates that 62% of these subscriptions originated from YouTube TV subscribers. Most Sunday Ticket purchases via YouTube occurred at the start of the NFL season.
Increased NFL Viewership: NFL football has seen a 6% increase in viewership this season, attributed to a combination of streaming and broadcast TV. The rise is linked to Amazon Prime Video’s Thursday Night Football, ABC, and ESPN networks. Thursday Night Football ratings surged 25% from the previous year, averaging 12.5 million viewers per game.
Restructuring Agreement between Diamond Sports Group and NBA: Diamond Sports Group, undergoing a restructuring plan, reached an agreement with the NBA to maintain all 13 of the league's teams contracted with Bally Sports on the regional sports network through the 2023-24 season. The agreement involves relinquishing rights early, with the NBA taking full control of them after this season.
Media
Vizio's WatchFree+ Expands Content Offering: Vizio's free ad-supported streaming service, WatchFree+, has expanded its content by securing new deals with BBC Studios, Magnolia Pictures, and Paramount Global Content Distribution. WatchFree+ has doubled its content offerings compared to a year ago, and the recent deals are part of Vizio's aggressive expansion strategy for free premium content in 2023.
Debate on Live TV Streaming Services: A group of 23 U.S. House Representatives has written a letter to the FCC opposing the transformation of live TV streaming services into cable TV companies. This follows a letter from Democratic Senators supporting such a transformation, while other Senators have raised objections. Local ABC, CBS, FOX, and NBC station owners have been advocating for this change for some time, adding complexity to the ongoing debate.
CrimsonRock's First Year Success: Join the Journey
As we celebrate the one year mark of CrimsonRock, I'm thrilled to express my heartfelt gratitude for your unwavering support during this incredible journey. Together, we've built a vibrant community, and I'm truly grateful.
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Here's a look back at our recommendations for 2022-2023 and their peak year-to-date performances. The rationale for these investments were driven by the following:
In 2022, governments are actively intervening in the market, deviating from traditional supply-demand dynamics. Central banks hesitated to withdraw support measures like quantitative easing, while politicians focused on economic protection, wealth inequality, oil prices/reserves, and increased spending.
Long-term inflation was expected, with U.S. inflation likely remaining above 4% until 2024 (i.e., peaked at 5%+ in 2023). Anticipating this, a proactive Federal Reserve role was deemed beneficial for the macroeconomic environment and markets.
Fed Chair Jerome Powell anticipated challenges for U.S. stocks, emphasizing the importance of positioning and technical factors in the illiquid market. But on the contrary, tech stocks like NVDA 0.00%↑, AMZN 0.00%↑, MSFT 0.00%↑, META 0.00%↑ acted as interest rate derivatives, and others like AAPL 0.00%↑ correlated with the labor market.
This strategic analysis helped to identify key dynamics and align with high performing trades, navigating the evolving economic landscape.
🚀 Invested in Emerging Market Technology 🌏
Taiwan Semiconductor Manufacturing Co Ltd: 86%
Tencent Holdings Ltd: 116%
Alibaba Group Holding Ltd: 113%
Nvidia: 360%
Samsung Electronics Co Ltd: 30%