Axios is the exclusive coverage partner for Nielsen’s annual Consumer 360 Summit today and tomorrow in Washington, D.C. Speakers include marketing and advertising executives from Facebook, Snapchat, CBS and more. Look for Sara Fischer's coverage throughout the day in the Axios stream for all-day coverage of the event.
Illustration: Lazaro Gamio/Axios
As tech companies get drawn into the deepening trade fight between the U.S. and China, sound bites are winning at the expense of a smarter understanding of the two nations' web of competition and cooperation.
"That complexity doesn’t translate well on a bumper sticker," says Dean Garfield, head of Information Technology Industry, a trade group representing U.S. and global tech companies.
The bottom line: Understanding where the U.S. is vis-à-vis China means accepting hard and competing truths. It's true that China would love its tech industry to take over more of the leadership and value the U.S. has in areas like chips, software and internet services. And it's equally true that the U.S. is utterly dependent on China.
Where we are now: Facebook is the latest company to get caught up in the battle over China, with leading papers blasting headlines such as "Facebook Gave Data Access to Chinese Firm Flagged by U.S. Intelligence."
To be sure: That's true, but keep in mind these headlines could also be true:
The fact is that Chinese companies are critical suppliers and partners to U.S. tech companies. Using Chinese manufacturing allows consumers around the globe to get the technology they want at prices they can afford, Garfield said.
"No one wants to pay $500 for a t-shirt or $10,000 for a phone," he said. Access to the giant Chinese market is also attractive to U.S. tech companies.
Reasons for concern: This dependence, though, is challenging.
"There is no doubt there are legitimate concerns — both national security and economic — related to China," Garfield said. "The thing that we in the tech sector try to avoid is being reductionist in assuming simply because it is China that it is bad. That is simply not the case."
It's complicated: Political consultant Bruce Mehlman says there is naiveté among both elected officials and industry players, with elected officials "not realizing how global the supply chains have become" and tech companies underestimating the global implications of China's "overwhelmingly aggressive" 2025 plan to dominate the tech industry.
"The core issue is that both nations want to dominate a sector defined by network effects," Mehlman told Axios. "The best innovators leverage bigger data sets, larger consumer bases, global customers, while the most aggressive nationalists aim to box-out others’ products and people."
Speaking of China, Commerce Secretary Wilbur Ross told CNBC this morning that U.S. negotiators have "executed a definitive agreement with ZTE," including a new $1 billion fine and 10 years of compliance monitoring.
Just how dominant are Apple and Samsung in the global smartphone business? Well, for the first three months of the year, the top 10 phones all came from one of those firms, according to IHS Markit.
The bottom line, per IHS Markit: Apple and Samsung not only dominate the list of the best-selling models, but the two firms also account for nearly all the industry's profits, with the combined rest of the industry struggling to break even.
Former FCC Chairman Tom Wheeler. Photo: Matthew Eisman/Getty Images for Common Sense Media
Former FCC Chairman Tom Wheeler said it's "painful" to see his legacy being systematically erased and warned of the dangers of net neutrality rules going away, Axios' David McCabe reports. On Wednesday, Wheeler said:
"Major local monopolies will be told it is fair to discriminate, and we should not be surprised if, not overnight but over time, we begin to see internet services discriminate in a way that benefits their bottom line rather than the diversity of choices available to consumers and the opportunities available to innovators."
Separately: Wheeler also weighed in on the messy dispute over whether cyberattacks slowed comments on the FCC site during net neutrality debates in 2014 and 2017. David writes more on this here.
Jason Calacanis. Photo: Earl Mcgehee/Getty Images
Many Silicon Valley leaders believe they've created a meritocracy that's working just fine. Progressive critics and people in groups who feel they've been excluded see it as fundamentally broken.
Our thought bubble: It's rare to see these two perspectives face off head to head, civilly, in a public forum. But, as Axios' Scott Rosenberg observes, that's pretty much what happened at an Oakland event last Friday.
The details: Prominent tech investor Jason Calacanis walked back some controversial comments about bias in tech — and unintentionally offered an inventory of the industry's persistent blind spots on diversity and inclusion.
Go deeper: Scott describes what happened here.
Apple has applied for a U.S. patent on a new type of small blood pressure cuff that could connect to a portable device. The patent application, made public late Wednesday, is for a device that could either be part of a portable electronic device or communicate wirelessly with one.
A separate patent application, also disclosed Wednesday, covers a method for producing a registry of health and wellness data, some of which could be shared with researchers, family members or caregivers.
Why it matters: While never a sure indication of any forthcoming products, patent filings can show where the interest of companies lie, and these add to the idea that Apple is putting a lot of energy into the health arena.
Check out this Kickstarter effort to create a cookbook specifically for those dealing with the taste change that often comes with chemotherapy.