🥇 Apple’s Epic “victory”

… and Netflix’s K-pop moment means we could get another “Squid Game”   Tim cooked up a legal victory (Jerod Harris/Getty Images)   Yesterday’s Market Moves   Dow Jones 33,531 (-1.02%) S&P 500 4,072 (-1.58%) Nasdaq 11,799 (-1.98%) Bitcoin $28,291 (+2.80%) Dow Jones 33,531 (-1.02%) S&P 500 4,072 (-1.58%) Nasdaq 11,799 (-1.98%) Bitcoin $28,291 (+2.80%) Hey Snackers, Artificial intelligence is buzzy, but some bots are getting bashed: [Snap]( released a ChatGPT-powered bot called “My AI” — and pinned it to the top of everyone’s feed with no option of removing it. Since then, Snap’s App Store page has been [flooded]( with 1-star reviews (the top keyword: “AI”). The Nasdaq sank 2% yesterday ahead of Big Tech earnings (part one), which came in after the bell. [Microsoft]( and [Alphabet]( shares spiked after they reported expectation-topping numbers. [Meta]( up next today, followed by [Amazon]( tomorrow. Skins Apple declares victory in its App Store battle versus Fortnite, but there’s a banana peel in its path Victory Royale… [Apple]( described its day in court versus Epic Games yesterday as “a resounding victory” after 9 out of 10 of the Fortnite maker’s claims [were decided]( in Apple’s favor. Refresher: in 2020, Fortnite was booted from Apple’s and Google’s stores after it directed players to its own discounted payment system to bypass the “app tax.” Epic retaliated by suing both tech titans and making a dramatic “1984” [parody video](. The legal saga appears to be over: - Not a mobile-opoly: Judges ruled that App Store policies don’t break federal antitrust laws. Apple won’t need to allow third-party app stores on iOS devices or change its fees. The one claim that got away… is the core of Epic’s suit. The ruling says Apple [can’t bar]( developers from steering users to off-app purchasing pages to skirt the 15 to 30% fee that Apple skims off in-app purchases (picture: Beef Boss skins). Read: Epic could allow players to set down their shockwave hammers and leave the Fortnite app to pay outside Apple’s ecosystem. Fortnite hasn’t been on the App Store since 2020, but it could return this year. - Giving up a slice: Last year, Apple started allowing “reading apps” — including [Netflix]( Audible, and [Spotify]( — to steer customers to alt payment options. Now it’ll have to extend the policy to games, too, if it fails to appeal this week’s ruling. - Prob-llama: As of 2021, gaming apps made up about 70% of all App Store revenue. If game developers start linking out to other payment options, Apple’s lucrative biz could take a hit. THE TAKEAWAY The walled garden could show cracks… Apple (mostly) won this round, but scrutiny of its app-store dominance isn’t over. Authorities in South Korea, the Netherlands, and Japan forced Apple to allow third-party payment systems to be added to apps, and an EU law could mean iOS 17 will open the door to app downloads from third-party app stores (aka: “sideloading”). K-wave Netflix is splurging $2.5B on South Korean content as a K-wave goes global From K-pop to K-drama… Yesterday Netflix said it plans to [spend]( $2.5B over the next four years to produce South Korean shows and movies, doubling its investment in the market. Over half of Netflix viewers watched Korean content last year, and 40% of its most-watched non-English-language shows are Korean, from revenge drama “The Glory” to reality hits like “Single’s Inferno.” As Netflix rolls out its largest-ever lineup of K-content, [Disney]( Amazon, and Apple are investing in the streaming K-wave. With good reason: - Untapped potential: Last quarter, Netflix added 1.5M paid subscribers in Asia Pacific, making it the fastest-growing region by far. - Red-jumpsuit mania: “Squid Game” was a phenomenon, earning a half dozen Emmys and becoming Netflix’s most watched show or film ever — topping 110M viewers. - Ram-Don gold: Korean dark comedy “Parasite” made Oscars history in 2020 as the first foreign-language film to win Best Picture. From “Beef” to Black Pink… Korea has become a pop-culture powerhouse and entertainment leader. Just a few examples: K-pop band BTS added $5B/year to the Korean economy (nearly 0.5% of the country's GDP) as the mega-stars took over charts worldwide. This month, the group Black Pink made history as the first Asian band to headline Coachella. THE TAKEAWAY One wave can reach many shores… South Korea’s entertainment industry isn’t only boosting the Korean economy; it’s also fueling international engagement for streamers as its popularity spreads everywhere. While Hollywood has long been the main purveyor of entertainment, Korea’s solidified its place as an industry leader. What else we're Snackin' - [YouToo]( Alphabet stock popped after the Google parent beat expectations and announced a $70B share buyback, though growth is sluggish. Ad revenue fell from last year as spending on YouTube commercials sagged. - [Soft]( Microsoft topped profit and sales estimates, despite a continuing slowdown in cloud as companies pulled back on investments. The software heavyweight’s’s sales grew just 7% after years of double-digit gains. - [Based]( [Coinbase]( played an UNO reverse card against the SEC, suing the regulator before it could file its own suit. The US’s largest crypto exchange is trying to force the SEC to issue clearer digital-asset rules. - [McDeal]( [McDonald’s]( beat quarterly expectations (think: ordering a 6-piece but getting a 10-piece) as inflation-wary US customers continued to hit the drive-thru for meal deals despite price hikes. - [Wrapped]( Spotify hit a record 515M users last quarter, up 22% from a year ago, but swung to a loss as ad revenue disappointed. The streamer plans to share some of its exclusive podcasts to bump their moneymaking potential. 🍪 Thanks for Snacking with us! Want to share the Snacks? Invite your friends to sign up [here](. Snack Fact Of the Day Amazon, Alphabet, Microsoft, and Meta make up about 15% of the S&P 500’s market value [Read more]( Wednesday - Earnings expected from Meta, Boeing, Hilton, Norfolk Southern, Roku, Wyndham, and Spirit Airlines Authors of this Snacks own shares of: Alphabet, Amazon, Apple, Disney, Microsoft, Roku, and Snap Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... [See more]( [Robinhood Terms and Conditions]( • [Our Editorial Principles]( • [Contact Us](mailto:hellosnacks@sherwoodmedia.com) • [Privacy Policy]( [Manage Your Subscription Preferences](