1 00:00:05,280 --> 00:00:06,600 Speaker 1: This is what the Flux. 2 00:00:06,640 --> 00:00:09,119 Speaker 2: I'm Brett and I'm Justin and it's Friday, the twentieth 3 00:00:09,119 --> 00:00:09,960 Speaker 2: of March. Boy. 4 00:00:09,960 --> 00:00:11,960 Speaker 1: Hold on to your little coffee mug over there, my friend, 5 00:00:11,960 --> 00:00:14,840 Speaker 1: because it's becoming a luxury ATAM. One of Australia's mokes 6 00:00:14,840 --> 00:00:17,560 Speaker 1: for renowned chefs, Neil Perry reckons we could be coughing 7 00:00:17,640 --> 00:00:20,400 Speaker 1: up twelve bucks for a single coffee within the next 8 00:00:20,400 --> 00:00:22,680 Speaker 1: five years. Oh, he said. With indust rays rising and 9 00:00:22,720 --> 00:00:26,439 Speaker 1: Bristol wages climbing, the humble morning coffee is turning into 10 00:00:26,520 --> 00:00:27,760 Speaker 1: a premium experience. 11 00:00:27,800 --> 00:00:29,280 Speaker 2: You got to take out a morgage for the coffee. 12 00:00:29,720 --> 00:00:32,960 Speaker 2: Flex Am. We are officially back today with quick Sticks. 13 00:00:33,040 --> 00:00:35,919 Speaker 2: That is a weekly quiz on three business and finance 14 00:00:36,000 --> 00:00:38,320 Speaker 2: questions where you can win fifty bucks if you're the 15 00:00:38,320 --> 00:00:41,000 Speaker 2: first person to get all three questions right. It'll drop 16 00:00:41,040 --> 00:00:43,240 Speaker 2: at a random time today to make sure you've downloaded 17 00:00:43,280 --> 00:00:45,280 Speaker 2: the Flux app and have your notifications turned on. 18 00:00:45,479 --> 00:00:47,800 Speaker 1: Three exciting stories today, Jussie boy, let's do it for 19 00:00:47,920 --> 00:00:51,480 Speaker 1: our first. The AHBLEC has launched a public investigation into 20 00:00:51,520 --> 00:00:55,600 Speaker 1: weather major fuel suppliers have been committing anti competitive conduct 21 00:00:55,600 --> 00:00:56,720 Speaker 1: in regional Australia, but. 22 00:00:56,760 --> 00:00:58,920 Speaker 2: A funny business happening in the regions, v Man. What 23 00:00:59,080 --> 00:00:59,680 Speaker 2: is going on here? 24 00:01:00,440 --> 00:01:02,040 Speaker 1: We know that since the war in the Middle East 25 00:01:02,120 --> 00:01:04,399 Speaker 1: kicked off, the price of oil per barrel has jumped 26 00:01:04,400 --> 00:01:06,040 Speaker 1: more than sixty five percent. 27 00:01:05,760 --> 00:01:07,760 Speaker 2: And that often flows into our petrol bowsers in the 28 00:01:07,760 --> 00:01:10,600 Speaker 2: short term and the price of products in the medium term. 29 00:01:10,640 --> 00:01:13,320 Speaker 1: But now there is another possible reason fuel prices could 30 00:01:13,360 --> 00:01:16,600 Speaker 1: be feeling extra cooked. Go on. The ahrible c ie 31 00:01:16,680 --> 00:01:21,120 Speaker 1: Australia's competition COP is investigating allegations of anti competitive conduct 32 00:01:21,200 --> 00:01:22,600 Speaker 1: in the petrol industry. 33 00:01:22,240 --> 00:01:25,640 Speaker 2: More specifically in the supply of diesel across regional and 34 00:01:25,880 --> 00:01:26,800 Speaker 2: rural Australia. 35 00:01:26,920 --> 00:01:29,280 Speaker 1: And this isn't some small corner of the market either. 36 00:01:29,360 --> 00:01:32,640 Speaker 2: Nope, the companies in the firing line include Ampole, BP, Australia, 37 00:01:32,840 --> 00:01:36,400 Speaker 2: Mobile Oil and Viva Energy, aka the big dogs at 38 00:01:36,400 --> 00:01:36,959 Speaker 2: the bowsers. 39 00:01:37,000 --> 00:01:38,920 Speaker 1: Now, the a trible c announced that it has heard 40 00:01:39,000 --> 00:01:42,319 Speaker 1: whispers that the big dog petrol suppliers have been limiting 41 00:01:42,319 --> 00:01:45,600 Speaker 1: access of diesel to smaller regional petrol stations. The really 42 00:01:45,640 --> 00:01:48,080 Speaker 1: unusual bit, though, is that the hriablec has publicly announced 43 00:01:48,080 --> 00:01:50,200 Speaker 1: the investigation before reaching any conclusions, and. 44 00:01:50,200 --> 00:01:53,160 Speaker 2: The ATRIBLEC says that there are concerns around fuel pricing 45 00:01:53,240 --> 00:01:56,640 Speaker 2: and supply that are especially heightened by the Middle East conflicts, and. 46 00:01:56,600 --> 00:01:58,680 Speaker 1: Does a boy when there is market concentration by a 47 00:01:58,720 --> 00:02:01,680 Speaker 1: few players, the arible c is extra sensitive to anti 48 00:02:01,720 --> 00:02:02,760 Speaker 1: competitive conduct. 49 00:02:02,800 --> 00:02:04,120 Speaker 2: So what is the key learning here? 50 00:02:04,240 --> 00:02:06,720 Speaker 1: Market concentration is a way of describing how much of 51 00:02:06,720 --> 00:02:09,760 Speaker 1: a market is controlled by a small number of companies. 52 00:02:09,360 --> 00:02:11,600 Speaker 2: The fuel plays in the market, the quicker things can 53 00:02:11,639 --> 00:02:14,400 Speaker 2: go from competitive to cartelli. 54 00:02:13,919 --> 00:02:17,200 Speaker 1: And that doesn't automatically mean anything improper is happening, but 55 00:02:17,240 --> 00:02:19,320 Speaker 1: it does mean regulators pay closer attention. 56 00:02:19,400 --> 00:02:21,919 Speaker 2: For example, we man in the twenty twenty four financial year, 57 00:02:22,080 --> 00:02:25,160 Speaker 2: four major petrol companies supplied around eighty eight percent of 58 00:02:25,160 --> 00:02:26,120 Speaker 2: petrol in Australia. 59 00:02:26,160 --> 00:02:29,120 Speaker 1: Ampoles, your vps, your xon mobiles, your viv energies. 60 00:02:28,840 --> 00:02:31,079 Speaker 2: And that means if they decide to actively or even 61 00:02:31,200 --> 00:02:34,440 Speaker 2: passively work together, they can materially change the supply and 62 00:02:34,520 --> 00:02:35,720 Speaker 2: pricing in the petrol market. 63 00:02:35,800 --> 00:02:39,359 Speaker 1: That is why concentration can become risky in essential sectors 64 00:02:39,600 --> 00:02:40,359 Speaker 1: like fuel. 65 00:02:40,120 --> 00:02:43,320 Speaker 2: And that is why the atripleceeds flag this investigation much 66 00:02:43,320 --> 00:02:44,400 Speaker 2: earlier than normal. 67 00:02:44,520 --> 00:02:48,000 Speaker 1: For our second story, Meta is pulling horizon Worlds off 68 00:02:48,040 --> 00:02:51,080 Speaker 1: its VR headsets as it shifts further and further away 69 00:02:51,240 --> 00:02:53,960 Speaker 1: from its expensive metaverse dream metaverse. 70 00:02:54,000 --> 00:02:56,760 Speaker 2: So what's that We only care about AI now, So 71 00:02:56,800 --> 00:02:57,520 Speaker 2: what's going on here? 72 00:02:57,560 --> 00:03:00,520 Speaker 1: So Meta formally known as Facebook, rebranded in twenty two 73 00:03:00,680 --> 00:03:02,359 Speaker 1: one to go all in on the metaverse. 74 00:03:02,560 --> 00:03:04,480 Speaker 2: They were so committed to the vision they changed the 75 00:03:04,720 --> 00:03:06,160 Speaker 2: entire company name for it. 76 00:03:06,240 --> 00:03:09,639 Speaker 1: At the time, the part man part robot zuk called 77 00:03:09,680 --> 00:03:11,280 Speaker 1: it the next frontier. 78 00:03:10,880 --> 00:03:13,120 Speaker 2: And the man the crown jewel of that frontier was 79 00:03:13,240 --> 00:03:14,520 Speaker 2: Horizon world It. 80 00:03:14,440 --> 00:03:17,000 Speaker 1: Was meant to be metas virtual social playground where people 81 00:03:17,000 --> 00:03:20,280 Speaker 1: could work, or shop or hang out as cartoon avatars, and. 82 00:03:20,240 --> 00:03:22,360 Speaker 2: It didn't have the best of starts. Remember when Meta 83 00:03:22,400 --> 00:03:25,160 Speaker 2: proudly showed off Horizon avatars that didn't have legs. 84 00:03:25,200 --> 00:03:27,320 Speaker 1: I do in hindsight, this is a pretty decent metaphor 85 00:03:27,360 --> 00:03:28,200 Speaker 1: for the whole strategy. 86 00:03:28,560 --> 00:03:31,359 Speaker 2: But now Metas announced it will pull Horizon Worlds off 87 00:03:31,400 --> 00:03:33,560 Speaker 2: its VR app store called Quest. 88 00:03:33,320 --> 00:03:35,760 Speaker 1: In June this year because apparently at its peak, Horizon 89 00:03:35,800 --> 00:03:39,480 Speaker 1: Worlds only attracted a couple of one hundred thousand monthly active users. 90 00:03:39,160 --> 00:03:42,880 Speaker 2: Which is microscopic compared to the billions using metas core apps, 91 00:03:42,880 --> 00:03:45,440 Speaker 2: and finally it's become even too much for Meta to handle. 92 00:03:45,560 --> 00:03:46,880 Speaker 2: So what is the key leading here? 93 00:03:47,000 --> 00:03:49,880 Speaker 1: Markets will back a big, bold vision, but not forever. 94 00:03:49,960 --> 00:03:51,960 Speaker 2: In twenty twenty one, the Zark had a ten year 95 00:03:52,000 --> 00:03:54,840 Speaker 2: plan for one billion people in the Metaverse and hundreds 96 00:03:54,840 --> 00:03:56,880 Speaker 2: of billions of dollars in digital commerce. 97 00:03:56,960 --> 00:03:59,360 Speaker 1: The five years after this bold vision, there are only 98 00:03:59,440 --> 00:04:02,560 Speaker 1: a couple one hundred thousand people on the platform. 99 00:04:02,120 --> 00:04:05,320 Speaker 2: And the Reality Labs division which houses met As Betaverse Push, 100 00:04:05,440 --> 00:04:08,920 Speaker 2: has wracked up nearly eighty billion US dollars in operating 101 00:04:08,920 --> 00:04:09,840 Speaker 2: losses and Jaseboy. 102 00:04:09,840 --> 00:04:12,480 Speaker 1: At some point, companies need to prove that massive investment 103 00:04:12,520 --> 00:04:15,280 Speaker 1: is turning into real users and real revenue and will returns. 104 00:04:15,360 --> 00:04:18,599 Speaker 2: Otherwise even the boldest next frontier starts to look like 105 00:04:18,680 --> 00:04:20,160 Speaker 2: a very costly distraction. 106 00:04:20,360 --> 00:04:24,159 Speaker 1: For our third and final story, Microsoft is threatening legal 107 00:04:24,160 --> 00:04:27,599 Speaker 1: action against its partner open Ai after a fifty billion 108 00:04:27,839 --> 00:04:31,680 Speaker 1: US dollar Amazon deal, risks turning an exclusive partnership into 109 00:04:31,720 --> 00:04:33,640 Speaker 1: a very awkward cloud. 110 00:04:33,320 --> 00:04:38,080 Speaker 2: Thraple, notwhing, says strategic partnership Quite like preparing the legal team, 111 00:04:38,200 --> 00:04:39,360 Speaker 2: So tell me what's going on here. 112 00:04:39,400 --> 00:04:41,720 Speaker 1: So Microsoft and open Ai have basically been the tech 113 00:04:41,760 --> 00:04:43,960 Speaker 1: world's ultimate power couple for the last few years. 114 00:04:43,800 --> 00:04:46,520 Speaker 2: Especially when it comes to cloud infrastructure and access to 115 00:04:46,560 --> 00:04:47,479 Speaker 2: open as models. 116 00:04:47,520 --> 00:04:50,920 Speaker 1: Microsoft first backed open Ai with a one billion dollar 117 00:04:50,920 --> 00:04:52,480 Speaker 1: investment in twenty nineteen. 118 00:04:52,160 --> 00:04:54,359 Speaker 2: Then it followed up with another ten billion dollar investment 119 00:04:54,400 --> 00:04:55,599 Speaker 2: in early twenty twenty three. 120 00:04:55,440 --> 00:04:58,719 Speaker 1: And part of that relationship gave Microsoft's Azure platform a 121 00:04:58,880 --> 00:04:59,880 Speaker 1: very important seat at the. 122 00:05:00,480 --> 00:05:04,640 Speaker 2: They became the exclusive cloud provider for key open AI services. 123 00:05:04,279 --> 00:05:06,800 Speaker 1: Which is a pretty nice perk when your partner happens 124 00:05:06,800 --> 00:05:09,520 Speaker 1: to be making the hottest AI models on the planet. 125 00:05:09,400 --> 00:05:12,279 Speaker 2: But now be man. Amazon has apparently rocked up with flowers, 126 00:05:12,320 --> 00:05:15,200 Speaker 2: a bottle of wine, and a fifty billion US dollar check. 127 00:05:15,240 --> 00:05:17,640 Speaker 1: As part of this new relationship, open Ai has made 128 00:05:17,760 --> 00:05:21,279 Speaker 1: Amazon Web Services their exclusive third party cloud provider for 129 00:05:21,320 --> 00:05:23,400 Speaker 1: one of their specific tools named Frontier. 130 00:05:23,480 --> 00:05:27,040 Speaker 2: That's their enterprise platform for building and running AI agents. 131 00:05:26,680 --> 00:05:28,640 Speaker 1: And as you can imagine, juzzy boy, Microsoft is not 132 00:05:28,680 --> 00:05:32,720 Speaker 1: exactly thrilled when AWS suddenly squeezing onto this very type cout, 133 00:05:33,200 --> 00:05:34,400 Speaker 1: and Microsoft. 134 00:05:33,880 --> 00:05:36,919 Speaker 2: Believes this new deal could clash with the exclusivity it 135 00:05:37,040 --> 00:05:38,599 Speaker 2: already has with open Ai. 136 00:05:38,760 --> 00:05:41,360 Speaker 1: So now the three companies are apparently trying to work 137 00:05:41,360 --> 00:05:43,880 Speaker 1: out whether this relationship can survive as a cloud based 138 00:05:43,960 --> 00:05:46,880 Speaker 1: th upple, but if it fails, Microsoft is pulling out 139 00:05:46,880 --> 00:05:48,760 Speaker 1: the legal action, So what's okay learning here? 140 00:05:48,800 --> 00:05:51,719 Speaker 2: Strategic dependency is when one company becomes so important to 141 00:05:51,760 --> 00:05:55,320 Speaker 2: another The relationship creates significant upside opportunity, but a lot 142 00:05:55,320 --> 00:05:57,800 Speaker 2: of downside risk as well, and Microsoft and open Ai 143 00:05:57,960 --> 00:06:01,760 Speaker 2: are a classic example. Yeah, Microsoft poured billions into open ai. 144 00:06:01,720 --> 00:06:04,040 Speaker 1: And without capital It has also used that relationship to 145 00:06:04,080 --> 00:06:07,120 Speaker 1: strengthen its cloud service Azure and build out its AI 146 00:06:07,200 --> 00:06:08,280 Speaker 1: chatbot Copilot. 147 00:06:08,279 --> 00:06:11,000 Speaker 2: And open Ai relied on Microsoft for its mula as 148 00:06:11,040 --> 00:06:13,560 Speaker 2: well as its enterprise reach to scale quickly. 149 00:06:13,279 --> 00:06:16,040 Speaker 1: But it also becomes fragile when incentives start to shift. 150 00:06:16,120 --> 00:06:20,359 Speaker 2: For example, open Ai now wants more flexibility with more partners. 151 00:06:19,920 --> 00:06:22,600 Speaker 1: Like Amazon, who committed to investing fifty billion US dollars 152 00:06:22,640 --> 00:06:24,719 Speaker 1: into open Ai in their latest capital rays. 153 00:06:24,520 --> 00:06:27,200 Speaker 2: Whereas Microsoft they want to protect the value of the 154 00:06:27,240 --> 00:06:28,440 Speaker 2: advantage that they've paid for. 155 00:06:28,480 --> 00:06:31,280 Speaker 1: So jaziboyit. The closer these two companies become, the more 156 00:06:31,360 --> 00:06:34,120 Speaker 1: damage can be done when goals no longer perfectly match. 157 00:06:34,560 --> 00:06:36,360 Speaker 2: Flex sam If you want to win fifty bucks before 158 00:06:36,400 --> 00:06:38,880 Speaker 2: this weekend, make sure you download the Flux out and 159 00:06:39,000 --> 00:06:41,640 Speaker 2: ready and waiting for the quick six notification to come through. 160 00:06:41,720 --> 00:06:44,560 Speaker 2: First Place to answer three business or finance questions correctly, 161 00:06:44,640 --> 00:06:46,720 Speaker 2: Win's the Cash. Make sure to download the Flux out 162 00:06:46,800 --> 00:06:47,480 Speaker 2: to win this week. 163 00:06:47,520 --> 00:06:49,719 Speaker 1: Thanks for listening and we'll see you on Monday.