Opinions And Ramblings By Adam Kmiec On All Things

What Happened In 2018? Was I Right?

Twitter vs. Snap Stock Price

2019 is just around the corner. While there’s still time for something crazy to happen, I think it’s possible to fairly judge how I did with my 2018 predictions.

The standard rules still apply. Each prediction is objectively reviewed. I’m a notoriously hard grader. A prediction that came true receives a single point. Predictions that missed the mark are awarded no points. While I do try to avoid half-point situations, there are on occasion circumstances where it’s fair to indicate I was partially correct.

For a recap of how things have gone over the years, here’s the quick summary:

  • 2017: 7.5/10 for a 75% hit rate.
  • 2016: 8.5/15 for a 56.7% hit rate.
  • 2015: 6.5/10 for a 65% hit rate.
  • 2014: 8/10 for an 80% hit rate.
  • 2013: 3/5 for a 60% hit rate.
  • 2012: 9/10 for a 90% hit rate.

To paraphrase the late Denny Green, was 2018 who we thought it was? Let’s find out. The original prediction from 2018 will be listed first in bold font followed by the analysis.

  1. The Apple HomePod will flop. The launch delay was the first sign. The significant ground it has to make up with Google and Amazon are another. But, it will be Apple’s walled garden approach, combined with price, that will ultimately make it dead on arrival. Umm, yeah. This was a horrible rollout for Apple. Everyone, including the analysts, thinks it was a flop. One point for Kmiec right out of the gate.
  2. The AT&T – Time Warner merger will not happen at all or will only happen if they choose to make significant divestitures. This is one that might change before the New Year. At present, it doesn’t look like it will happen this year. But, as is, this is a point.
  3. The contrast of #2 is that the Fox – Disney merger will happen without issue. Nailed it. Like taking candy from a baby.
  4. This will be a big year for M&A, mostly out of necessity. I predict 3 large deals beyond the above, from lands of media, retail and CPG. This definitely happened. Take your pick on which three examples you want to highlight. I’ll take Home Shopping Network and QVC merging. Huge. I’ll also take CVS Health joining forces with Aetna. And, I’ll take Hershey buying SkinnyPop. Those weren’t even the most exciting. I casually left out Amazon buying Whole Foods.
  5. Augmented Reality will plateau in interest and adoption. It was always a gimmick and the slow death knell of Pokemon Go is the tip of the iceberg. Yep and yep. AR is basically flat at best, to the most optimistic person. PokemonGo’s leadership indicated user growth has decreased, but in fairness, the hardcore users are still there. That is the clear definition of a slow death that’s begun.
  6. The concerns over Net Neutrality will be for naught. There will be at least 1 major initiative that shows how deregulation leads to innovation. This is a half-point. There’s yet to be a major upside or a major downside to the ruling. I could argue it’s been for naught, but I’m struggling to find that 1 major initiative.
  7. Facebook growth slows, but Facebook the company continues to see enormous growth, buoyed by WhatsApp and Instagram. Definitely happened across the board. Facebook growth slowed to an all-time worst. WhatsApp and Instagram continue to grow. Open and shut case.
  8. Tesla and Netflix will have down years. Netflix’s debt will be a problem for investors. That debt combined with continued growth from Hulu, YouTube, Disney and others will force changes. With Tesla, they will once again miss shipments, over-promise, under-deliver, but this time, it will catch up to them. This is a classic half-point scenario. As measured by stock price, they had decent years, albeit with Tesla a rollercoaster experience. Tesla did under-deliver and did miss shipments. Netflix took heat for cancellations and debt. I don’t think it was a good year for either, but a clean diagnostic like stock price disagrees. It’s a push and I’ll take half a point.
  9. Bitcoin and all its variants will see a massive fall off in valuation. This will happen as traditional monetary institutions continue their assault on Bitcoin and a massive data breach / hack / fraud / theft will take place. Bitcoin indeed cratered and continues to crater. Oh and yes there were hacks. Take your pick, like this one.
  10. Robert Mueller’s probe will conclude and will yield nothing of substance. Substance will be evaluated as yielding something that would have grounds for an impeachment vote. There will not be an impeachment vote. Another scenario where I could take a half-point, but I won’t. While there was no impeachment vote and still no substance, we still don’t have a conclusion.
  11. There will be a backlash against the #MeToo movement when false accusations are made and found to have been made for political or corporate gain. Definitely happened. The statistics show a backlash took place. The examples of false allegations for gain are definitely out there and some were significant. This is more than unfortunate, but not all that surprising. Sadly, one significant misstep hurts an entire populace. For every Rolling Stone Virginia Frat story, there are numerous real victims who will suffer.
  12. Twitter will have a better year than Snap, as measured by stock price change. Sometimes a picture really is worth a thousand words. As the photo at the top of this post indicates, it was was no bueno for Snap. Nailed it.
  13. Amazon will face a large government inquiry. It won’t antitrust, but it will be something in that area. I’m shocked this didn’t materialize in 2018. With the announcement of HQ 2 and 3, I think we might see it happening in 2019.
  14. Three things will happen in the gaming world: Nintendo will have a bad year. They will struggle to grow with a walled garden model, inferior hardware and a poor understanding of how gaming works on phones. The uproar over EA’s approach to microtransactions for Star Wars Battlefront II will shape the industry at large. Specifically, there will be an effort to curb or eliminate micro-transactions altogether. Microsoft will announce the next evolution of the Xbox. This won’t be a minor upgrade like the “S” or the “X”, it will be the next generation. Oh man, this was a mixed bag. Despite Nintendo Switch sales being better than I ever thought, Nintendo had a down year. The stock opened around $45 and now sits at $35. Not good. Microsoft did not release a new Xbox. As for microtransactions, which are often called “loot boxes” or “loot crates” in games, there’s a definite effort to curb this. In Belgium, they are now outlawed and considered illegal. This won’t be the last country to do so. I award myself a half-point.
  15. A major sports league will adopt technology on the field to assist with calls. For example, FIFA will adopt replay or the NFL will add chips into footballs to determine if they break the goal line. Sorta happened, but I don’t feel good about it, so I’m only taking a half-point. The Premier League became the latest to adopt VAR (video assistant referee), which is similar to replay challenges adopted by the NFL and MLB. We didn’t see chips introduced, but we did see things like the Los Angeles Clippers’ CourtVision product. It provides fans the ability “to customize what they see, including play diagrams in Coach Mode, real-time shooting percentages in Player Mode, and special effects and animations in Mascot Mode.” Very cool. The digital and sports collision will continue in 2019.
  16. Whiskey will have a down year, with gin and rum seeing a resurgence. Technically I could claim this for a half-point. Gin, particularly in the U.K. is up. Ditto with rum. However, whiskey isn’t even close to being down. It’s still growing. We can thank millennials! This was a miss.
  17. Star Wars: Episode VIII, the Last Jedi will go down as the worst fan rated Star Wars movie, as measured by Rotten Tomatoes. This is a good example of where I need to be even clearer with articulating what might happen. When I said, “as measured by Rotten Tomatoes”, I meant the fan score, not the critic score. If you go by the fan score, this absolutely happened. How bad was the Last Jedi? Well, it was worse than the Phantom Menace. Seriously. The Phantom Menace carries a 59% fan rating while the Last Jedi is only at 45%.
  18. Harley Davidson will introduce a mass-market electric motorcycle. This happened depending on your definition of “introduced.” The Harley Davidson LiveWire was introduced/announced in Q3, but can’t be bought til 2019. I’m claiming it.
  19. A major motion picture will be released simultaneously at the box office and for streaming. It didn’t happen, but we’re closer than ever. Netflix “announced in late October that it would begin releasing select movies in theaters before making them available on its streaming platform, rather than on the same day. ” The lag was 3-days. We’re getting there!
  20. There will be 5 states that will legalize/introduce recreational marijuana laws. The tax money is simply too good to pass up. This happened, and then some. In 2018 we saw the approval of legislation in Michigan, Missouri, Utah, Oklahoma, Vermont. Additionally, Indiana and Kansas made the usage of CBP legal for any use. The green wave, if you will, continues.
  21. Pinterest will IPO. It will be successful. This did not happen. Next year maybe?
  22. The lesson from Mashable will be repeated. So-called “new media” companies, once considered darlings, will start to implode. I see bad years for Vox and Buzzfeed. This happened and happened hard. As the Financial Times stated, “Vice, BuzzFeed and Vox hit by changes in digital media industry” and “New generation of once-hot groups forced to adjust models as rules of business alter”. And how. Was this really surprising? I mean think about it. When you’re overly dependent on Facebook for traffic and are so blatantly one-sided while catering the lowest possible form of literacy, wasn’t a downfall inevitable?

So, how did we do? Well, I started strong by nailing 1 – 5. Stumbled a bit on 6 – 10,  where I picked up a half-point on 6 and 8, a full point on 7 and 9, but whiffed on 10. Then another roller coaster of results on 11 – 15. There were clear wins on 11 and 12, with a clear miss on 13 and half-points on 14 and 15. On 16 – 20, I missed mightily on 16 and 19, but nailed 17, 18 and 20, while closing out the list with a split on 21 (no) and 22 (yes). That makes the tally 18/22 for an 82% success rate. I’ll take it.

With a solid 2018, my cumulative 7-year score is 60.5/82 for a 74% successful prediction rate.

I’ll have predictions for 2019 up sometime in late December.