Uber For Planes

Plus: Russian diamonds are no longer a girl’s best friend. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

May 11, 2023

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TOGETHER WITH

Good morning.

Is Bob Iger the third Mario Brother?

The prodigal Disney CEO curiously went out of his way on an earnings call Wednesday to praise the success of rival Universal’s $1.1 billion animated mega-hit. Whatever his motive, one thing is clear: Iger needs a pair of Brooklyn plumbers to clean up Disney’s animated theatrical mess in the wake of flops like “Lightyear” and “Strange World.” To his credit, Iger leaned into that reality by telling analysts that the Super Mario Brothers movie “certainly proves people love to be entertained in theaters around the world, and it gives us reason to be optimistic about the movie business.” The guy who owns Star Wars and Marvel should only hope.

Morning Brief

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Uber takes to the skies.

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Isn’t it Icahn-ic? Don’t you think?

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Diamonds are a tsar’s best friend.

Tech

Uber Launches Flight-Booking Product in the UK

(Photo Credit: John McArthur/Unsplash)

Uber users opening the app for a quick ride home after a late night out partying better start paying attention to what button they press.

On Wednesday, Uber announced its UK users will be able to book both domestic and international flights in its app by this summer as part of its ambition to create a “super app,” per the Financial Times. Uber’s UK general manager Andrew Brem said in a statement the booking process will take “as little as one minute.”

Uber Everything

Even before it got into the airline business, Uber was flying high. It reported its first-ever positive cash flow in August 2022, and since then it has managed to skirt the enormous job cuts which have afflicted other tech companies — although it did announce in February that it would shed some employees via “even more rigorous” performance reviews. So rest assured that Uber employees have really been gunning for 5 stars lately.

In a surprisingly comfortable position, and having added a hefty string to its bow with food-delivery product UberEats, Uber is now using the UK as a testing ground for integrating itself into a wider transport infrastructure:

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Uber has already added features to its UK app to let users book train and bus tickets, and Brem told the FT that train reservations have gone up 40% month-on-month since they launched in August last year. He didn’t, however, provide any hard figures and given the UK has been ravaged by train strikes since June last year, maybe he’d rather not say.

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To sell plane tickets, Uber is co-piloting with travel booking site Hopper. Uber will take a commission on each sale, and has the option to add booking fees in the future if the feature really takes off.

Many Silicon Valley firms want to enmesh themselves into critical infrastructures like payment, transport, and communication. Elon Musk announced upon buying Twitter that he wanted to make the social app into an “everything app,” and Meta has integrated its payment system “Meta Pay” (formerly Facebook Pay) into its roster of apps.

Bye Bye Birdie: While Twitter pursues “everything app” status, it may be losing its title as the internet’s unofficial customer service desk. Airlines including Ryanair have announced this month that they won’t answer customer service questions on Twitter anymore, and it’s not just because people were less than kind to them on a platform not especially known for its sweetness and light. The Wall Street Journal reported this was a consequence of the chaos surrounding the platform’s blue check marks, meaning some unverified airlines fear their accounts could be easily mimicked. Fliers will have to find another way to publicly shame airlines into answering their questions while stranded in an airport.

– Isobel Asher Hamilton

Legal

Icahn Under Federal Investigation After Hindenburg Report

“Those regulations are more like guidelines than actual rules, Mr. Prosecutor,” is a bold defense.

On Wednesday, the investment company of billionaire financier Carl Ichan disclosed it’s being investigated by federal prosecutors after a short-seller report accused Icahn Enterprises of inflating the value of its assets. In other words, market manipulation. In other other words, illegal.

Hindenburg Strikes Again

Last week, short-seller Hindenburg Research released a report called “Icahn Enterprises: The Corporate Raider Throwing Stones From His Own Glass House.” Something tells us it wasn’t a puff piece. In it, Hindenburg accused IEP of inflating shares by more than 75% and likened the company to a Ponzi scheme. IEP’s stock price took a blow after the report was published and, yesterday, it took another hit when the company announced it was cooperating with a federal investigation.

This is Hindenburg’s one-two punch. They bet on a stock to depreciate and then they release a damning financial report on that company that will likely make its stock fall. The end result is that Hindenburg gets to walk away many dollars richer. You could even argue that itself is a form of market manipulation, but it’s all technically on the up-and-up since they’re exposing bad actors.

IEP said it was cooperating with the request and that prosecutors had “not made any claims or allegations against us or Mr. Icahn” and that “we believe that we maintain a strong compliance program.” But this is far from Icahn’s first regulatory rodeo:

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Former President Donald Trump attempted to tap Icahn as a regulatory advisor, basically giving him a spare key to the kingdom. Right away the ethics of the decision were questioned. In 2018, federal prosecutors issued him a subpoena in regard to IEP trading shares of crane manufacturer Manitowoc right before the White House imposed tariffs on foreign-made steel. The timing seemed a little too fortunate.

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In 2017, prosecutors alleged Ichan provided Las Vegas sports gambling kingpin William Walters with tips for trades in Clorox stock in 2011. Icahn was never charged with anything, but Williams was sentenced to five years in prison for a $43 million scheme linked to the insider trading of Dean Foods, one of the largest dairy processors.

This Means War: Icahn, as is his wont, made it clear he wasn’t going down without a fight. He, of course, didn’t have kind words for the short seller. In a statement, he said Hindenburg “would be more aptly named Blitzkrieg Research given its tactics of wantonly destroying property and harming innocent civilians.”

– Griffin Kelly

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Trade

The G7 Wants To Crack Down on Russian Diamonds

Russian sanctions are like anniversaries. They go: oil, gas, diamond.

The G7 countries are planning to come up with a scheme that would broaden the definition of “blood diamonds” as a way of cutting off Russia’s diamond exports, according to a draft document seen by the Financial Times.

Putin In The Sky With Diamonds

Russia’s had a bad week. The country’s victory parade showcased one very lonely tank, and the sanctions on its energy industry caused the Kremlin to bite the bullet and raise taxes on oil production. Compared to the mountainous energy sector, Russia’s diamond trade is like a pebble, but given how strapped for cash Putin is right now any dampener on the country’s revenue streams could have an effect — especially since Russia imposed a $244 million windfall tax this year on diamond mining company Alrosa.

The US has already imposed its own restrictions on Russian diamonds, banning imports and sanctioning Alrosa, but the big plan now is to get an international agreement on how to best throttle the flow of diamonds out of Siberia:

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The EU currently has no sanctions on Russian diamonds, partly because member state Belgium has wanted to shield its diamond dealers in Antwerp. Now, however, Belgian Prime Minister Alexander de Croo says the country’s ready to take action.

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“We want to carve out Russian diamonds from Western markets. But we won’t achieve this with the existing direct bans of Russian diamonds. They haven’t had any meaningful impact on the financial flows for Russia’s war machine,” De Croo told the FT.

Diamonds In The Bureaucratic Rough: Part of the problem with existing sanctions is that diamonds move in a very international market and don’t require a ton of documentation. Many Russian diamonds, for example, end up in India for polishing, and then become nearly impossible to trace back to Mother Russia. The G7’s plan would create an industry-wide paper trail; because we all know that paper beats rock.

– Isobel Asher Hamilton

Extra Upside

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Underaged workers: Labor Department probe reveals young children working as cleanup crew in Nebraska slaughterhouse.

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I want my MTV: Paramount shuts down MTV news and lays off 25% of US staff.

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