It’s now Day Ten Million since the US went totally mad. Usually, that’s a typical day in Silicon Valley. I’ve found it enlightening how absurd the rest of the country looks when it mimics and distorts our little piece of heaven.
Which brings us to tariffs, or rather, the daily ever-changing threats of tariffs from our Fool-in-Chief. After briefly collapsing the stock market, the tariff levies were retracted, re-retracted, narrowed, cancelled, and suspended, for the most part. Of course, this changes daily, so take it for what it is — nonsense. Even China, stuck with 125% tariff at the moment, got exemptions for electronic products like smartphones, but that could change at any moment.
What is not nonsense is the impact on Silicon Valley. While huge companies like Apple can afford huge bribes to elected officials to keep their manufacturing humming and profitable, smaller businesses don’t have that luxury. Most smaller companies depend on reliable supplies of Chinese goods to integrate into their products, from chemicals to pharmaceuticals to medical devices to electronics. Most of the world relies on manufacturing in China, from washers to cars, because China has spent decades building up the expertise and equipment. Just cancelling it like a TV show and telling businesses to switch the channel won’t make it any more easier to repair a smartphone or a refrigerator or build laptops without Chinese components. Hollywood ain’t real life.
Which brings us to TikTok, the oft-maligned video snippet entity from China that American narcissists embrace.
Rumors here and there suggest that much of China’s tariff problems stem from a reluctance by ByteDance to part cheaply with TikTok to a favored US-based bidder. In 2024, ByteDance was deemed a national security issue due to accessing sensitive user data (as if US companies’ manufacturing and purchasing all our goods from them wasn’t sensitive but teenager’s babblevid is, heh). ByteDance was told to sell TikTok to someone we like or we’d ban them. The ban has never taken effect, because it gets extension after extension as bidders come and go. Add in the extra wrinkle that China would have to approve the deal, and it gets complicated. China can wait them out, endure a ban, or even subvert it if it so chooses.
A deal with a multitude of big pockets was supposedly coming together last month. Then, wack, China gets tariffed on everything. Well, almost everything. Well, maybe not things we like. Well, maybe everything. This is what most idiots think is “negotiation”. So the sale if it even existed got pulled, again.
Why is this company such a big deal when American companies couldn’t be bothered to to care about video?
It all comes back to Silicon Valley’s “misjudgment”.
Back around 2010, I was pitching a server-based video processing company that did not require any video editing skill or software. We just took clips from smartphones, added music and titles, cleaned up the artifacts and noise, put it in the required format, and placed it in a webpage automatically. A minute of video could be processed and look professional online in a minute. It was called CoolClip.
Why wasn’t CoolClip everywhere? Well, as one noted Sequoia Capital VC who will remain nameless but hails from South Africa as does Dear Leader Musk said (paraphrased), why do any production at all? YouTube doesn’t need it. Nobody needs it.
And another VC, a fellow Berkeley alum who was at that time at Mayfield, added the point that all production should be done in China. Why put it on a server and have a computer handle it when we can get *people* to do the production by hand, frame by frame. Isn’t that better?
And there were lots of lesser lights with equally inane opinions, like the wanna-be Gen-X tech journo player who basically said “Well, your stuff works, but no one wants it” with no investigation, wasting all our time. Sigh
Look, these people weren’t stupid (well maybe the tech journo), unlike the current administration. So what was really going on here?
The fact is, Silicon Valley investment did not see any value in short video. They weren’t up on formats, the complexities of editing software, and the rapid evolution of smartphones with cameras. They were blind to the Internet video disruption.
And now everyone is trying to grab for a piece of TikTok for $100B+. Crazy, right?
Which brings us to Instagram. Meta’s hopes for a market grab from TikTok has been on a roller coaster, with the looming FTC antitrust trial casting a dark shadow over its hopes. Filed in 2020 (nope, this isn’t a Biden decision), even Zuck’s recent payoffs to the president (paltry as they are) may not save Meta from forced divestment of Instagram and Whatsapp.
The trial starts today. Grab the popcorn and enjoy.