Axios

Income inequality — the stubborn curse of the current era and, many think, a key factor in the global uprising against establishment powers — appears to be on a solid, steady decline in the U.S., according to a new report.

Quick take: For more than a year, the wage gap has been closing between American workers with the least and the highest education—wages have been going up the most for workers who need it the most, according to Jed Kolko, chief economist for Indeed, the jobs website. And this year, the most chronically unemployed Americans began to return to work.

Retailers think this is the holiday season of the smart speaker, with Google, Amazon, and other tech firms spending big on marketing and discounts to get their voice-assistant technology into as many living rooms as possible.

David Watkins of Strategy Analytics tells Axios that 14 million smart speakers will be sold globally during the final three months of the year, driven by recent, heavy discounting of Google's Home and Amazon's Echo devices, as well as evidence that Alibaba's Genie is outselling expectations in China.

Why it matters: That is a lot of smart speakers: these devices tend to be bought one or two per home, and there are just 125 million households in the U.S.. Amazon and Google are going all out to move them, not because they earn a profit on heavily discounted sales, but to hook consumers and open up e-commerce and advertising revenue down the road.

Why retailers and brands should worry: Those revenues have to come from somewhere. One possibility is that they will be driven by new marketing spending by retailers and brands specifically aimed at these platforms; another is that these devices will motivate shoppers to do more shopping over the Internet.

Thumbs on the scale: According to Suzanne Tager, senior director of Bain & Company's retail and consumer products practices, Alexa-enabled Amazon devices steer customers toward Amazon private-label, in addition to items they have previously bought. Bain conducted a voice-ordering test across categories using Amazon Echo and found:

• If a search falls within a category in which Amazon offers private label products, "Alexa first recommends the private-label products, even though these products represent only about 2%" of the total good sold from Amazon inventory, Tager says. Amazon did not respond to emails.
• RBC Capital estimates that by 2020, 128 million Alexa-enabled devices will be active globally, meaning that a bias towards Amazon or other products on this platform could have a serious effect on the retail industry.

Google to the rescue? Chris Taylor, who formerly ran Target's experimental Store of the Future, cites retail partnerships involving Google Assistant as an example of what might work.

• Walmart, Costco, Home Depot and Target all allow purchases through Google Assistant.
• In a test, Gene Munster of Loup Ventures said he found that the Google Assistant's AI seems superior to Alexa's. He said Assistant understood questions better, and that it is rapidly improving. This will become more important as these companies attempt to add capabilities, like complex queries and understanding conversations with multiple participants.
• But Amazon is not without partners of its own—Best Buy and Starbucks are working with Alexa to sell their products. Pop up stores that Amazon is opening with Calvin Klein in New York and Los Angeles also feature Echo in the dressing rooms.
• And so far Amazon's lead in the smart speaker race is a commanding 71% market share to Google's 26%. And according to Technalysis Research, 69% of users detect little to no accuracy differences between the assistants.

A rock and a hard place: Tager says that competition resembles "the early days of a classic platform race," where tech companies compete to lock in both users and providers of goods and services.

• The creation of dominant, high-tech platforms should be eyed warily by those who will be forced to compete or collaborate with those platforms, Tager said.
• If voice becomes a truly popular means of commerce, brands and retailers will have to figure out how to negotiate yet another layer of technology inserted between them and the customer. "Instead of making sure you're on the first page of search results, you'll have to make sure you're the one or two items that Alexa suggests you buy," she said.
• Taylor said voice may follow a track similar to the invention of social media—remaining a curiosity for many but a crucial promotional tool for those who figure out how to best reach its most dedicated users.

South African retail conglomerate Steinhoff, which owns the U.S.-based MattressFirm, announced Wednesday that CEO Markus Jooste had tendered his resignation from the company after the board learned of information relating to "accounting irregularities requiring further investigation." Steinhoff is the world's second-largest furniture dealer with operations in Europe, Africa, Australia, and the U.S.

Why it matters: The company's stock fell more than 60% during trading Wednesday in Frankfurt, where the stock is listed. "This story has the smell of Enron, which rocked financial markets, starting in 2000," Writes Raymond James analyst Budd Bugatch in a note to clients Wendesday. "It is too soon, obviously, to know the ultimate impact of this mess."

To cope with the surge of online holiday shopping and lagging delivery, the United Parcel Service has told drivers at more than 100 different centers that they may ask them to work 70 hours over 8 days instead of 60 over 7 days. UPS has also added 1-2 days to some transit times and surcharges for packages shipped during peak times, according to Wall Street Journal.

Why it matters: In order for the online shopping boom to last, delivery services have to keep up with the demand. UPS has already invested billions in new warehouses and automation, but ShipMatrix, a company that analyzes shipping data, said that only 89.2% of UPS packages arrived on time last week.

The European Court of Justice ruled Wednesday that luxury brands have the right to prevent retailers from selling their products on third-party marketplaces like Amazon.com if the restriction is motivated by the desire to preserve the brand's exclusive image.

Why it matters: Brands have chafed at their inability under U.S. law to prevent retailers, who sometimes acquire products without the brands' consent, from reselling that merchandise through online marketplaces.

Amazon likes to call itself "the everything store," but it's also on it's way to being the everywhere store, launching its 12th global marketplace Tuesday in Australia. But the retail reckoning that many observers had predicted when Amazon finally unveiled its Australian website didn't materialize, as customers shopping on Amazon.au found selection to be lacking and prices high, Reuters reports.

Why it matters: Stocks of Australian retailers like Myer Holdings department store rose on the news of Amazon's lackluster debut, but Australian retailers shouldn't get too comfortable. As the Australian Financial Review warned earlier this year, "While other companies dread making colossal mistakes, [Jeff] Bezos seems just not to care," arguing that Amazon's deep pockets and long-term outlook allow it to profit from the lessons learned through initial failure.

Netflix has dropped actor Danny Masterson from their show "The Ranch" after several women accused him of drugging and violently raping them in the early 2000s. The streaming service told HuffPost in a statement Tuesday that yesterday was Masterson's last day.

Timing: The news comes a day after Netflix confirmed that an executive told one of the accusers that the company doesn't believe the allegations, describing them as "careless" and "uninformed." Masterson's ouster also comes roughly a month after Netflix suspended "House of Cards" after the show's star, Kevin Spacey, was accused of sexual misconduct.

News Corp is taking aim at the digital-ad dominance of Google and Facebook with a new platform to let advertisers reach audiences across all of its online properties. The new platform, called News IQ, will pull audience data from sites like The Wall Street Journal, New York Post and Barron's and give advertisers a way to reach specific audiences around safe content.

Why it matters: News Corp is the latest publishing company to launch a data-based advertising network to win back digital ad dollars from Google and Facebook. Disney, NBC and Vox Media, and Verizon and Oath have all similar steps.

White House Deputy Press Secretary Hogan Gidley didn't take on-the-record questions from reporters traveling with President Trump to Utah today, instead reading prepared statements and then offering to speak with reporters off-the-record, which reporters declined. As reported by the press pool:

"Gidley then made a motion with his hand at his neck to have the audio cut and said 'That being said all I have to offer you on the record is that I can go off the record to address a couple of issues but I can't give you anything on.'"

Why this matters: It's rare for a presidential spokesman to not take questions from the traveling press during a trip when no regular briefing was conducted in Washington.