Apr 28, 2020

Axios Login

I'm trying something new. Along with several Axios colleagues, I’m answering your questions via a Twitter Video Q&A on how the coronavirus is impacting the tech industry. You can tweet your questions using #AskAxios and #AskAxiosIna now and I will answer them live Wednesday at 2pm ET.

Today's Login is 1,461 words, a 6-minute read.

1 big thing: Pandemic clouds phone sales as the world goes immobile

Illustration: Eniola Odetunde/Axios

Smartphone sales could take an especially strong hit this year as people cut spending, travel less and prioritize other types of technology.

Why it matters: Smartphones provide a huge chunk of industry revenue because hundreds of millions are sold each year. It's a key business not just for phonemakers like Apple and Samsung, but for component suppliers like Corning and chipmakers like Qualcomm.

What's happening: In an updated forecast last week. the Consumer Technology Association said it expects between 138 million and 153 million smartphones to be sold in the U.S. this year. That represents a drop of as much as 15% from last year. In January, the group had anticipated this year's smartphone sales rising 2%, to 166 million units.

Between the lines: A number of factors explain the expected dip, including:

  • Overall consumer spending is slowing. People are losing jobs and those still employed are also tightening their spending.
  • People are putting scarce resources elsewhere. Other tech gear, including laptops, monitors and even the oft-maligned desktop computer, suddenly seem like bigger priorities, along with home-office devices and wireless equipment.
  • There are fewer reasons to upgrade. Some people buy a new phone because they break their device, lose it or have it stolen. All these things are happening less often. And who needs a better camera when you barely leave the house?
  • Upgrade cycles had already been lengthening before the crisis hit, as customers hung on to their old smartphones longer with the disappearance of carrier subsidies and the steady rise of high-end phone prices.

Yes, but: None of this has stopped a flurry of smartphone launches even during a time when most Americans are sheltered at home.

  • Apple launched the iPhone SE, which is probably the phone with the broadest appeal, offering a lower-cost option to those who do want a new phone.
  • Motorola and OnePlus both offered up new high-end models earlier this month, and Samsung managed to get in one of the last in-person launches with a San Francisco event in February to unveil the Galaxy S20 family.

What's next: Question marks surround the fall lineup, with much of the speculation centered around Apple.

  • A Monday Wall Street Journal report suggests Apple is still on track to deliver several new iPhone models, though they could come a month or so later than in the past.
  • Google is also expected to deliver new Pixel models. A lower-cost version of the latest Pixel, likely the 4a, could come soon, while Google had been expected to launch a new flagship model in the fall.
  • Samsung typically updates its Note family in the fall and has continued to do so, even as the Galaxy S line has absorbed many of the features once limited to the Note line. It would be a surprise if Samsung didn't do so this fall, coronavirus or not.

What they're saying:

  • NPD analyst Stephen Baker said that the market faces a "perfect storm" with smartphones already slowing heading into the year, and now people going out less, traveling less and having ready access to better options to watch video. "Mobility is much less important to me in this environment than it has ever been before," Baker said.
  • Creative Strategies analyst Carolina Milanesi notes that smartphones remain our most-used devices so sales won't completely fall off a cliff, though some buyers may shift toward mid-range devices. Most at risk are phones built around a gimmick, such as folding devices.
2. Uber and San Francisco tangle over pricing

Uber looks like it's playing hardball again — this time in a conflict with the city of San Francisco over food delivery fees, Axios' Kia Kokalitcheva writes.

What's happening: In response to an order from the San Francisco mayor capping the fees delivery services can charges restaurants, Uber's food delivery business announced Friday it would no longer serve residents of the city's Treasure Island neighborhood, saying it's no longer able to finance those operations.

Context: Uber made its reputation sparring with city governments, but in recent years has learned to moderate its approach during crises.

  • The company let ride-hailing prices in New York City surge due to high demand as Hurricane Sandy hit the city in 2012. Following immediate and intense backlash, it then doubled driver earnings while charging passengers standard fares until the storm was over. 
  • In 2014, the company settled with New York’s attorney general, agreeing to cap surge pricing during natural disasters and emergencies there and nationwide. It has broadly avoided fights with officials over crisis pricing ever since.

The San Francisco fight breaks that pattern.

  • "Unfortunately ... the restrictions imposed by this order forced us to update our service area to reduce operational costs," a spokesperson said in a statement. "We remain hopeful that the temporary changes that companies were forced to make won't further hurt those that we're trying to help the most during this time: customers, small businesses and delivery people."
  • Supervisor Matt Haney, who represents Treasure Island in San Francisco's City Hall, accused the company of shutting out the neighborhood as retaliation for the fee cap.

Between the lines: Unlike a hurricane, which lasts a few days, Uber expects this crisis to go on — and that's likely why it is eager to fight the fee cap, particularly if other cities follow suit.

Our thought bubble: Uber is already a money-losing business, but its effort to keep its losses in check might not win much sympathy given how widespread the economic pain is right now, and how much people depend on delivery services.

Go deeper: The gig economy's coronavirus test

3. Coronavirus’ link to other global crises

Illustration: Axios on HBO

For this week's Axios on HBO, I had a chance to step a bit outside my usual tech reporting and talk with a conservation expert on why wild animal markets, known as "wet markets," pose such a risk for animal diseases to spread to humans.

Why it matters: Diseases are much more likely to spread from animals to humans when animals are taken out of their natural habitats and put under stress and in close proximity to other animals, the Wildlife Conservation Society's Joe Walston said in an interview that aired Monday.

Context: Much attention in the search for the origins of COVID-19 has focused on China’s wet markets, where wild animals are held close together and sold to humans for consumption.

  • Closing such markets would make it much harder for viruses to jump from animals to humans, Walston said.
  • More than a billion people each year become sick from diseases related to animals, Walston said. Many of the most recent serious new diseases came from animals.

The big picture: Viruses that originate with animals shouldn't be thought of as isolated events, Walston said, but instead in the context of other global crises, including climate change and threats to biodiversity.

  • Removing wild animals from their environments disrupts their native ecosystems, which harms biodiversity and exacerbates climate change, he added.
  • "When you remove elephants from the forests of Central Africa, you've removed the major seed disperser and the major gardener of that system, and forests start to degrade," he said.

Between the lines: Walston threw cold water on the notion that the virus was created in a lab: "Before it got from that bat into humans, there was absolutely no evidence that it came from any laboratory."

4. Apple doubles down on news podcasts

Apple is sprucing up the news category of its podcast app amid increased interest, as Sara Fischer reports. The update will initially be available for people in the U.S., Canada, U.K., and Australia, a spokesperson tells Axios.

Between the lines: Consumption of news podcasts is skyrocketing, according to data from podcast analytics firm Podtrac.

Details: Beginning Tuesday, Apple's editorial team will recommend new collections and shows inside Apple Podcasts' news category, which will feature information around COVID-19, the U.S. presidential election, and other topics.

  • Earlier this month, Apple Podcasts launched "COVID-19: Essential Listening,” a collection of the best news, science, health and culture podcasts around the topic.
  • Apple has also built voice commands through Siri that play the latest news around the pandemic from sources like CNN or the BBC when a user asks for information around keywords like "COVID-19," "coronavirus,"or "health."

By the numbers: Apple says its podcast app now has 1 million shows in more than 100 languages and 175 countries and regions.

What's next: Similar news podcast recommendations will roll out to additional countries and regions in the future.

5. Take Note

On Tap

  • Today's earnings reports include Google parent Alphabet and AMD.

Trading Places


  • Verizon, Comcast and AT&T are extending benefits put in place amid the pandemic, including waiving overage charges and other fees and providing additional data to customers. (Reuters)
  • An app called Plunjr is connecting people with plumbing help via video chat. (San Francisco Chronicle)
  • Tech industry leaders are using their influence (and access to private planes) to help get medical supplies from China. (MIT Tech Review)
  • When it comes to remembering their internet passwords, 42% say they type their password wrong occasionally, while 17% say they do so frequently and 7% say they do so very frequently. Hey, I'm in the top 7%! (GitHub)
  • GOP Sen. Josh Hawley wants the Justice Department to open a criminal investigation into Amazon over its reported use of third-party seller data to develop in-house products. (The Verge)
  • The U.K. is developing its own alternative to Google and Apple’s joint contact-tracing effort. (BBC News)
6. After you Login

A Vallejo, California, planning commissioner has resigned after throwing his cat during an online meeting being held over Zoom.