INDIA IPPON DESU
Friday, December 30, 2016
Thursday, December 22, 2016
Why FLipkart & OLA is calling for protectionism
An opinion in Times of India
By Tarun Davda
First things first. As a VC, I'm a strong believer in open markets and believe healthy competition leads to better outcomes for all involved, especially consumers. Since our economic liberalisation in 1991, we've seen that foreign competition has helped our own companies build better products at more competitive prices, while becoming more nimble and customer focused. At the same time, foreign investments in sectors across retail, aviation, pharma, technology, etc. have helped unleash a new era of daring Indian entrepreneurs who have the courage to dream big and have created some of India's most well-known and valuable companies.
A couple of days ago, we all witnessed headlines screaming that Flipkart's Sachin Bansal and Ola's Bhavish Aggarwal are allegedly "seeking government protection in their battle against global rivals". You can read the articles here and here . Not surprisingly, there has been a barrage of opinions on social media, with many criticising our local heroes for seeking government protection. Before taking sides, lets first understand the issue more deeply. At the risk of being unpopular, I thought I'd share my own views on this topic. To be clear, I don't know Sachin Bansal and have never met or discussed this with him. However, Bhavish is a founder very very dear to me and we're fortunate to be early investors in Ola. I'm more familiar with Ola and hence this post is more about Ola-Uber and less about Flipkart-Amazon, even though many of the same issues apply. Anyone who knows Bhavish, will tell you he is among the most audacious entrepreneurs this country has produced. It takes someone special to go against the mighty Uber and stay ahead of them despite all odds. So why is Bhavish raising this issue and why now? What is the real issue beyond the sensational headlines? Ola's Bhavish Aggarwal and Flipkart's Sachin Bansal
The Issue I believe many people have misunderstood Sachin & Bhavish's position. Here 's the video of their statement — take 5 minutes and see what they actually said. They aren't against competition. They aren't afraid of competing against global companies. They aren't against foreign capital or anything else the media would have you believe. Far from it — their own companies are dependent on large doses of foreign capital. They also know that fighting against their global peers has helped them improve their own service — a net positive for everyone. So what is the issue then? Simply put, their argument is that global rivals are indulging in an unhealthy market practice known as "capital dumping". They are channelizing money from profitable markets abroad to fund irrational spends and losses here in India. This is to drive local competitors out of the market by "buying" market share. And the single goal of such a practice has always been to eventually monopolize and exploit the market to its fullest potential. This dubious strategy is considered anti-competitive in many jurisdictions and is illegal under competition laws. Read more about anti-trust, capital-dumping, predatory-pricing and more here on Investopedia. If you look at the difference in gross margins of the few consumer internet companies in question, in their home markets vis-a-vis those in India, the difference is telling. Their negative gross margins in India are a far cry from the profits they earn in their home markets. This is in stark contrast with other MNC firms that fairly compete across industries like FMCG, Pharma and even certain internet segments like Search and Social Networking, and establishes their land grab approach to market share. Estimated Gross Margins of MNC firms operating in India The WTO defines anti-dumping as "If a company exports a product at a price lower than the price it normally charges in its own home market, it is said to be "dumping" the product. Indian laws were amended with effect from 1.1.95 to bring them in line with the provisions of the respective GATT agreements.
India has effected anti-dumping in the past across sectors like banking and pharma which has helped create local giants like ICICI Bank, HDFC Bank, Sun Pharma, Dr. Reddy's among others. Read this excellent document to know more on the topic. While this is more in the context of goods, a similar principle ought to apply for services. By market estimates, Uber, selling at negative margins, burns over INR 3000 Crore (US $450 Million) per year in India — this is significantly more than Ola's burn rate despite Ola being much larger. In a letter to investors dated September 7th, Uber mentioned that it plans to further reallocate a significant amount of resources to India from China, where it recently sold its business to Didi. Product Innovation Innovating for consumers and solving real on-the-ground problems takes a serious hit because of capital dumping. I personally don't recall a single meaningful innovation that Uber has launched for the Indian market. All its growth here has come from throwing money at drivers and consumers. Not to forget, they have blindly copied many of Ola's local innovations — some have failed, while others have done them some good. But that isn't good enough for the ecosystem, because capital should never be allowed to stifle innovation. Ola's innovations are far beyond technology and category customizations e.g. by building an offline booking feature, they've not just allowed people to access mobility in no-network areas, but have inspired other apps across verticals to solve for poor connectivity in smaller towns. By quickly launching Ola Credit after the recent Demonetization, they've actually helped keep tens of thousands of Indians away from serpentine ATM queues. Or take Ola Play, a paradigm shift in the mobility and ride-sharing experience. Innovation has a direct impact on our nation's development; both as an inspiration for other companies and entrepreneurs, as well as for creating value for customers in the long run. In fact, innovation is the solution to sustained price optimization, not capital dumping.
A Level Playing Field So what are Sachin and Bhavish really asking for? All they are saying is let's create a level playing field, one where foreign companies aren't using profits they generate in their home geography to subsidise their product in India, with the singular motive of killing local players. They aren't here for charity. No business is. Amazon generates profits in the US, Uber also claims its profitable in the US. How does one compete with these giants if they have access to funding and profits from their home geography while you are dependent on funding alone? Eventually, capital sources will dry up and will lead to monopolistic behaviour by the one who survives. What's in the long-term interest of Indian Consumers? Make no mistake. Having sustainable competition is the best solution in the long term that will benefit consumers. That alone will ensure prices are fair and quality services are being provided, while both players generate reasonable profits. None of the global giants want that. They see India as a large market they want to own for decades and so are indulging in "capital dumping" with the hope that eventually local startups will run out of capital to compete and they can run a monopoly business in India. Once local rivals are out, they will raise prices. That hour-long cab ride you took to work for under Rs 100 will seem like a distant memory. Who knows what the new price will be, but suffice to say it will be significantly higher with sufficient markup to recuperate their losses. And the driver subsidy — it will vanish overnight. Case in point — here 's what happened in China where prices doubled overnight after the Didi-Uber merger.
The Way Ahead Given the scorching pace of growth of Indian internet companies, there is an urgent need to define and problem solve for the issues outlined above. Should this issue have been raised earlier? Absolutely. Did we as an industry fail in our duty to foresee and address these issues sooner, possibly. But there's never a bad time to discuss the right things. We are seeing the emergence of India's first wave of tech mega-corns and this is new territory for all of us. Moreover, the degree of undercutting on price has intensified in recent times with the intent to drive out local players. There's a fine line between price undercutting for promotional purpose v/s unfair market practices like capital dumping. How do you decide what constitutes capital dumping? I don't claim to have the answers but at-least a recognition and discussion of the core issue will help us all gravitate towards a practical solution that is in the long-term interest of consumers. It's disturbing that so many smart people have been quick to diss our local heroes without so much as a second thought. Let's understand these issues and the ramifications they will have on our country, let alone the nascent startup eco-system. India will be better served if we have the Flipkart's and Ola's thrive to become large platforms that can match and do even better than what their global peers do in their home markets. They will inspire a new generation of entrepreneurs who will believe they too can compete against the mightiest and have a shot at victory. Whether we like it or not, we are all long Flipkart and Ola — their decline will hurt the entire tech eco-system. And when they win (that doesn't mean their global peers must lose, they just need to stop their strategy of capital-dumping and compete fairly), our country will never be the same again. We can recreate the magic that happened in Silicon Valley and China. It will open up a rush of capital and lead to a new wave of innovation, the kind our country hasn't witnessed before. And our local heroes will be the ones leading that wave. And for that, they don't need protection, just a level playing field.
By Tarun Davda
First things first. As a VC, I'm a strong believer in open markets and believe healthy competition leads to better outcomes for all involved, especially consumers. Since our economic liberalisation in 1991, we've seen that foreign competition has helped our own companies build better products at more competitive prices, while becoming more nimble and customer focused. At the same time, foreign investments in sectors across retail, aviation, pharma, technology, etc. have helped unleash a new era of daring Indian entrepreneurs who have the courage to dream big and have created some of India's most well-known and valuable companies.
A couple of days ago, we all witnessed headlines screaming that Flipkart's Sachin Bansal and Ola's Bhavish Aggarwal are allegedly "seeking government protection in their battle against global rivals". You can read the articles here and here . Not surprisingly, there has been a barrage of opinions on social media, with many criticising our local heroes for seeking government protection. Before taking sides, lets first understand the issue more deeply. At the risk of being unpopular, I thought I'd share my own views on this topic. To be clear, I don't know Sachin Bansal and have never met or discussed this with him. However, Bhavish is a founder very very dear to me and we're fortunate to be early investors in Ola. I'm more familiar with Ola and hence this post is more about Ola-Uber and less about Flipkart-Amazon, even though many of the same issues apply. Anyone who knows Bhavish, will tell you he is among the most audacious entrepreneurs this country has produced. It takes someone special to go against the mighty Uber and stay ahead of them despite all odds. So why is Bhavish raising this issue and why now? What is the real issue beyond the sensational headlines? Ola's Bhavish Aggarwal and Flipkart's Sachin Bansal
The Issue I believe many people have misunderstood Sachin & Bhavish's position. Here 's the video of their statement — take 5 minutes and see what they actually said. They aren't against competition. They aren't afraid of competing against global companies. They aren't against foreign capital or anything else the media would have you believe. Far from it — their own companies are dependent on large doses of foreign capital. They also know that fighting against their global peers has helped them improve their own service — a net positive for everyone. So what is the issue then? Simply put, their argument is that global rivals are indulging in an unhealthy market practice known as "capital dumping". They are channelizing money from profitable markets abroad to fund irrational spends and losses here in India. This is to drive local competitors out of the market by "buying" market share. And the single goal of such a practice has always been to eventually monopolize and exploit the market to its fullest potential. This dubious strategy is considered anti-competitive in many jurisdictions and is illegal under competition laws. Read more about anti-trust, capital-dumping, predatory-pricing and more here on Investopedia. If you look at the difference in gross margins of the few consumer internet companies in question, in their home markets vis-a-vis those in India, the difference is telling. Their negative gross margins in India are a far cry from the profits they earn in their home markets. This is in stark contrast with other MNC firms that fairly compete across industries like FMCG, Pharma and even certain internet segments like Search and Social Networking, and establishes their land grab approach to market share. Estimated Gross Margins of MNC firms operating in India The WTO defines anti-dumping as "If a company exports a product at a price lower than the price it normally charges in its own home market, it is said to be "dumping" the product. Indian laws were amended with effect from 1.1.95 to bring them in line with the provisions of the respective GATT agreements.
India has effected anti-dumping in the past across sectors like banking and pharma which has helped create local giants like ICICI Bank, HDFC Bank, Sun Pharma, Dr. Reddy's among others. Read this excellent document to know more on the topic. While this is more in the context of goods, a similar principle ought to apply for services. By market estimates, Uber, selling at negative margins, burns over INR 3000 Crore (US $450 Million) per year in India — this is significantly more than Ola's burn rate despite Ola being much larger. In a letter to investors dated September 7th, Uber mentioned that it plans to further reallocate a significant amount of resources to India from China, where it recently sold its business to Didi. Product Innovation Innovating for consumers and solving real on-the-ground problems takes a serious hit because of capital dumping. I personally don't recall a single meaningful innovation that Uber has launched for the Indian market. All its growth here has come from throwing money at drivers and consumers. Not to forget, they have blindly copied many of Ola's local innovations — some have failed, while others have done them some good. But that isn't good enough for the ecosystem, because capital should never be allowed to stifle innovation. Ola's innovations are far beyond technology and category customizations e.g. by building an offline booking feature, they've not just allowed people to access mobility in no-network areas, but have inspired other apps across verticals to solve for poor connectivity in smaller towns. By quickly launching Ola Credit after the recent Demonetization, they've actually helped keep tens of thousands of Indians away from serpentine ATM queues. Or take Ola Play, a paradigm shift in the mobility and ride-sharing experience. Innovation has a direct impact on our nation's development; both as an inspiration for other companies and entrepreneurs, as well as for creating value for customers in the long run. In fact, innovation is the solution to sustained price optimization, not capital dumping.
A Level Playing Field So what are Sachin and Bhavish really asking for? All they are saying is let's create a level playing field, one where foreign companies aren't using profits they generate in their home geography to subsidise their product in India, with the singular motive of killing local players. They aren't here for charity. No business is. Amazon generates profits in the US, Uber also claims its profitable in the US. How does one compete with these giants if they have access to funding and profits from their home geography while you are dependent on funding alone? Eventually, capital sources will dry up and will lead to monopolistic behaviour by the one who survives. What's in the long-term interest of Indian Consumers? Make no mistake. Having sustainable competition is the best solution in the long term that will benefit consumers. That alone will ensure prices are fair and quality services are being provided, while both players generate reasonable profits. None of the global giants want that. They see India as a large market they want to own for decades and so are indulging in "capital dumping" with the hope that eventually local startups will run out of capital to compete and they can run a monopoly business in India. Once local rivals are out, they will raise prices. That hour-long cab ride you took to work for under Rs 100 will seem like a distant memory. Who knows what the new price will be, but suffice to say it will be significantly higher with sufficient markup to recuperate their losses. And the driver subsidy — it will vanish overnight. Case in point — here 's what happened in China where prices doubled overnight after the Didi-Uber merger.
The Way Ahead Given the scorching pace of growth of Indian internet companies, there is an urgent need to define and problem solve for the issues outlined above. Should this issue have been raised earlier? Absolutely. Did we as an industry fail in our duty to foresee and address these issues sooner, possibly. But there's never a bad time to discuss the right things. We are seeing the emergence of India's first wave of tech mega-corns and this is new territory for all of us. Moreover, the degree of undercutting on price has intensified in recent times with the intent to drive out local players. There's a fine line between price undercutting for promotional purpose v/s unfair market practices like capital dumping. How do you decide what constitutes capital dumping? I don't claim to have the answers but at-least a recognition and discussion of the core issue will help us all gravitate towards a practical solution that is in the long-term interest of consumers. It's disturbing that so many smart people have been quick to diss our local heroes without so much as a second thought. Let's understand these issues and the ramifications they will have on our country, let alone the nascent startup eco-system. India will be better served if we have the Flipkart's and Ola's thrive to become large platforms that can match and do even better than what their global peers do in their home markets. They will inspire a new generation of entrepreneurs who will believe they too can compete against the mightiest and have a shot at victory. Whether we like it or not, we are all long Flipkart and Ola — their decline will hurt the entire tech eco-system. And when they win (that doesn't mean their global peers must lose, they just need to stop their strategy of capital-dumping and compete fairly), our country will never be the same again. We can recreate the magic that happened in Silicon Valley and China. It will open up a rush of capital and lead to a new wave of innovation, the kind our country hasn't witnessed before. And our local heroes will be the ones leading that wave. And for that, they don't need protection, just a level playing field.
Harvard Business Review article on Demonetisation
By Bhaskar Chakravorti
India is in the throes of an unprecedented social experiment in enforced digital disruption, and the world has much to learn from it. Prime Minister Narendra Modi launched a surprise in early November, demonetizing 500 and 1,000 rupee bank notes. Modi’s war on cash is not without international precedent: Singapore, for example, withdrew its largest currency recently; the European Central Bank eliminated the 500-euro bank note; South Korea plans to eliminate at least all coins by 2020. And yet India’s initiative had the potential for chaos.
Here’s why: the government effectively took 86% of cash out of circulation in an economy that is close to 90% cash-reliant. One of Modi’s strongest motivations for this action was corruption — to expose undeclared “black” money, i.e. income illegally obtained or not declared for tax purposes, in Asia’s third-largest economy. But the government seems to have failed in meeting this objective. As of December 3, about 82% of the demonetized bills, amounting to about $185 billion, had been deposited in bank accounts and validated to be legitimately earned money (or legitimized after any additional taxes owed are accounted for). In other words, very little of the estimated $2 trillion black money estimated to be stashed overseas has been captured.
In the meantime, retail and wholesale markets have stalled around the country. Supply chain transactions, real estate deals, and even weddings and funerals have been frozen. Consumers are coping with lines that are frustrating even for Indians used to standing in lines or waiting for basic services. People up and down the income spectrum are dealing with changing cash withdrawal policies and empty ATMs. The nation’s status as the world’s fastest-growing big economy has been severely imperiled and its currency risks being further devalued, a situation made worse by prospects of a strengthening dollar after the U.S. election. Sounds bad, right? But there is a question that hasn’t been asked: Is there a digital upside to this crisis? A digital idealist might argue that the demonetization move is a welcome shock necessary to get a cash-intensive society weaned off its addiction and onto modern systems of digital payments. Indeed, since the chaos erupted, the prime minister has tweeted: “Time has come for everyone, particularly my young friends, to embrace e-banking, mobile banking & more such technology.” He has urged the other side of the market to digitize as well: “I want to tell my small merchant brothers and sisters, this is the chance for you to enter the digital world,” he said in Hindi on television, encouraging mobile banking applications and credit-card swipe machines.
This is an unusual form of digital disruption of an enforced kind, about as far as one can get from the textbook kind. Consider a few of its most salient aspects: This drastic shift affects the world’s fastest growing large economy, a population of 1.25 billion, and consumers whom we have identified as bearers of some of the highest “cost of cash” in the world (see our HBR article: “The Countries that Would Profit the Most from a Cashless World”). In other words, if a significant amount of the country’s payments were digitized, the benefits would be monumental. This disruption originates not from one of the e-wallet insurgents or from one of the global payments mega-players, but has been engineered top-down by the government. The biggest beneficiaries of this disruption, arguably, would be the incumbents, i.e. Reserve Bank of India, India’s central bank, and the banking institutions. According to our study, the Cost of Cash in India, these institutions spend $3.5 billion annually in currency operations costs. Ironically, the primary losers in this disruption, at least in the near term, are the consumers themselves. The disruptive action did not originate in a small segment of the market; it was launched nationwide. The burden has been regressive, as it has been hardest on the poor and the unbanked, who have had to forgo wages to stand in lines or have lost jobs because of non-functioning markets. So can the demonetization shock push digital payments into the mainstream? Some early reports are suggesting that, indeed, it has had an effect. The leading digital payments players have experienced a bump since the demonetization experiment began. That said, it is important to keep in mind that this bump builds on a low base. According to a 2013 Mastercard study, India was in the “Inception” category of both absolute level of cashlessness and the trajectory of change. Furthermore, there are three fundamental structural factors to be mindful of as we understand the Indian context: India’s ties to cash are strong, even by developing country standards. India uses a lot of cash by any measure. Our Cost of Cash in India study found a remarkably high level of cash usage even when compared with other emerging markets and otherwise digitally under-evolved countries, according to our Digital Evolution Index, reported earlier in HBR. The ratio of money held in bills and coins to the amount held in demand deposit and savings accounts in India was 51%, as compared to Egypt (29.3%), South Africa (8.9%), and Mexico (8.7%). Moreover, the value of notes and coins in circulation as a percentage of GDP in India was 12.04%, compared to 3.93% in Brazil, 5.32% in Mexico, and 3.72% in S'outh' Africa
There are strong reasons underlying this degree of cash reliance. Consider some of the most significant ones we found when we analyzed the 2014 landscape. Most Indians lacked the means to use non-cash payments, even if they want to. India’s infrastructure for payments was growing, but from very modest beginnings. Fewer than 35% of Indians above the age of 15 had used a bank account. Less than 10% had ever used any kind of non-cash payment instrument. Less than 3% of the value transacted used cards in the year ending March 2014. The growth in value of ATM transactions had far outpaced the growth in the value of card payment transactions. Moreover, in India, the total value of ATM transactions increased more than five times between 2007 and 2012, from about 3 trillion to about 18 trillion rupees, while the value of card transactions barely doubled in the same period from 1 to 2 trillion rupees. Despite the improvement in telecommunications, India lagged its peers in mobile payments. Fewer than 2% of Indians had used a mobile phone to receive a payment, compared to over 60% of Kenyans and 11% of Nigerians. Financial inclusion policies are bank-led rather than telecom-led. Much of India’s recent approach has focused on the supply side of financial inclusion. The priorities of the Reserve Bank (RBI), India’s central bank, are to promote safe, efficient, accessible, inclusive, interoperable, and robust payment systems. India has addressed these priorities both through the creation of national champions, such as the National Payments Corporation of India (NPCI) and its subsidiaries. The result is that India has built the capacity to clear and settle payments. Access to that infrastructure on a sustainable and profitable basis is a key reason behind India’s investment in universal identification (known as Aadhaar)-enabled payments services. The problem is that RBI chose a bank-led model over a telecoms-led one to achieve its financial inclusion goals. As a result, telecoms firms had only recently been allowed to enter the payments space in India, and were limited only to partnerships with banks. Compare this situation to that of Kenya, for example, where a surge in mobile payments has been engineered by the efforts of Safaricom, the major telecom company. The net result of a bank-led approach has been an insufficient investment in the necessary digital infrastructure and inadequate marketing of its potential uses and benefits. Consumers have been left unaware of how they might use mobile phones for services other than communications, texting, or Facebook.
The costs of cash to the Indian consumer are among the highest in the world. In our analyses of the cost of cash across over 70 countries, we found that the cost of cash to consumers – in terms of time spent to get cash and fees — are high in some of the world’s most populous countries. Unsurprisingly, cost to Indian consumers was among the highest. When weighted for population, India fared poorly in terms of ATM access compared to even lesser-developed countries, such as Kenya, Nigeria, or Egypt. Moreover, smaller cities in India had larger problems. Long before the current crisis, we found that residents of Delhi spent 6 million hours and $1.5 million to obtain cash, while residents of Hyderabad spent 1.7 million hours and $0.5 million to do the same. Hyderabadi consumer costs were about twice as high as that of Delhiites on a per capita basis. With this structural understanding in mind, how do we evaluate the potential impact of the demonetization move in getting digital payments past a tipping point? I would argue that, despite the high costs of cash, telling people – as the prime minister did — to go cashless is putting the cart before the horse. The horse in this case is the digital infrastructure and establishing a threshold of trust in the system; beefing up this digital ecosystem should come first. India’s digital state (it ranked 42nd out of the 50 countries we studied in our Digital Evolution Index), does not engender the threshold of trust needed for cashlessness to take hold in a meaningful way. Despite a billion mobile phone subscriptions, just about 30% of Indian subscribers use smartphones. A little over a third of the population has internet access. India lacks infrastructure needed to reliably expand access. Connections are patchy and unreliable and there is great disparity in connectivity: 70% of those with mobile internet access are in cities; only 17% of Indian women use the internet, according to the Pew Research Center. With women responsible for much of household purchases, this does not provide a strong foundation for the spread of digital payments where it really counts. According to Google India and The Boston Consulting Group, by 2020, digital transactions will happen at 10 times the current level. That may well come to pass; maybe demonetization may serve as the needed catalyst. But let us be clear: in the absence of a systematic and concerted investment in digital infrastructure and Internet access, cash will stubbornly resist wholesale digital displacement. It is useful to keep in mind that any form of currency, cold hard cash or digital, involves an “equilibrium mindset” — a mutually self-reinforcing logic — whereby the parties across a transaction must share a belief in the currency and trust that it works and holds value. If there is a shadow of doubt that affects one party’s trust in a particular form of currency, the other will prefer to not rely on it. Cash, unlike digital alternatives, has the benefit of being acceptable (almost) everywhere. If there is concern about the viability or acceptability of digital payments, venturing forth without cash will make consumers feel insecure. When we studied current habits in India, in the Cost of Cash in India, we found that there is great level of comfort in keeping moderate to significant levels of cash in hand, especially in small towns and rural areas. Even credit card users keep significant amounts of cash in hand, and they keep higher balances. The proportion of respondents who keep more than 2,000 rupees as minimum cash in hand is 29% in case of credit card users, as compared to 12% in case of cash-only users. The average amount of minimum cash carried by cash-only users or “debit cash and cash” users is relatively lower than the amount carried by credit card users. The proportion that carried minimum cash in the range of 100 – 500 rupees was 13% among credit card users, as compared to 27% among the cash users. What seems like a major push from physical to digital money will, in reality, happen at a slow pace. While I do not intend to demonize the demonetizers, this unfortunate crisis is a case study in poor policy and even poorer execution. Unfortunately, it is also the poor that bear the greatest burden. Editor’s note: We clarified how money that’s deposited in banks is considered legitimate.
Bhaskar Chakravorti is the Senior Associate Dean of International Business & Finance at The Fletcher School at Tufts University and founding Executive Director of Fletcher’s Institute for Business in the Global Context.
India is in the throes of an unprecedented social experiment in enforced digital disruption, and the world has much to learn from it. Prime Minister Narendra Modi launched a surprise in early November, demonetizing 500 and 1,000 rupee bank notes. Modi’s war on cash is not without international precedent: Singapore, for example, withdrew its largest currency recently; the European Central Bank eliminated the 500-euro bank note; South Korea plans to eliminate at least all coins by 2020. And yet India’s initiative had the potential for chaos.
Here’s why: the government effectively took 86% of cash out of circulation in an economy that is close to 90% cash-reliant. One of Modi’s strongest motivations for this action was corruption — to expose undeclared “black” money, i.e. income illegally obtained or not declared for tax purposes, in Asia’s third-largest economy. But the government seems to have failed in meeting this objective. As of December 3, about 82% of the demonetized bills, amounting to about $185 billion, had been deposited in bank accounts and validated to be legitimately earned money (or legitimized after any additional taxes owed are accounted for). In other words, very little of the estimated $2 trillion black money estimated to be stashed overseas has been captured.
In the meantime, retail and wholesale markets have stalled around the country. Supply chain transactions, real estate deals, and even weddings and funerals have been frozen. Consumers are coping with lines that are frustrating even for Indians used to standing in lines or waiting for basic services. People up and down the income spectrum are dealing with changing cash withdrawal policies and empty ATMs. The nation’s status as the world’s fastest-growing big economy has been severely imperiled and its currency risks being further devalued, a situation made worse by prospects of a strengthening dollar after the U.S. election. Sounds bad, right? But there is a question that hasn’t been asked: Is there a digital upside to this crisis? A digital idealist might argue that the demonetization move is a welcome shock necessary to get a cash-intensive society weaned off its addiction and onto modern systems of digital payments. Indeed, since the chaos erupted, the prime minister has tweeted: “Time has come for everyone, particularly my young friends, to embrace e-banking, mobile banking & more such technology.” He has urged the other side of the market to digitize as well: “I want to tell my small merchant brothers and sisters, this is the chance for you to enter the digital world,” he said in Hindi on television, encouraging mobile banking applications and credit-card swipe machines.
This is an unusual form of digital disruption of an enforced kind, about as far as one can get from the textbook kind. Consider a few of its most salient aspects: This drastic shift affects the world’s fastest growing large economy, a population of 1.25 billion, and consumers whom we have identified as bearers of some of the highest “cost of cash” in the world (see our HBR article: “The Countries that Would Profit the Most from a Cashless World”). In other words, if a significant amount of the country’s payments were digitized, the benefits would be monumental. This disruption originates not from one of the e-wallet insurgents or from one of the global payments mega-players, but has been engineered top-down by the government. The biggest beneficiaries of this disruption, arguably, would be the incumbents, i.e. Reserve Bank of India, India’s central bank, and the banking institutions. According to our study, the Cost of Cash in India, these institutions spend $3.5 billion annually in currency operations costs. Ironically, the primary losers in this disruption, at least in the near term, are the consumers themselves. The disruptive action did not originate in a small segment of the market; it was launched nationwide. The burden has been regressive, as it has been hardest on the poor and the unbanked, who have had to forgo wages to stand in lines or have lost jobs because of non-functioning markets. So can the demonetization shock push digital payments into the mainstream? Some early reports are suggesting that, indeed, it has had an effect. The leading digital payments players have experienced a bump since the demonetization experiment began. That said, it is important to keep in mind that this bump builds on a low base. According to a 2013 Mastercard study, India was in the “Inception” category of both absolute level of cashlessness and the trajectory of change. Furthermore, there are three fundamental structural factors to be mindful of as we understand the Indian context: India’s ties to cash are strong, even by developing country standards. India uses a lot of cash by any measure. Our Cost of Cash in India study found a remarkably high level of cash usage even when compared with other emerging markets and otherwise digitally under-evolved countries, according to our Digital Evolution Index, reported earlier in HBR. The ratio of money held in bills and coins to the amount held in demand deposit and savings accounts in India was 51%, as compared to Egypt (29.3%), South Africa (8.9%), and Mexico (8.7%). Moreover, the value of notes and coins in circulation as a percentage of GDP in India was 12.04%, compared to 3.93% in Brazil, 5.32% in Mexico, and 3.72% in S'outh' Africa
There are strong reasons underlying this degree of cash reliance. Consider some of the most significant ones we found when we analyzed the 2014 landscape. Most Indians lacked the means to use non-cash payments, even if they want to. India’s infrastructure for payments was growing, but from very modest beginnings. Fewer than 35% of Indians above the age of 15 had used a bank account. Less than 10% had ever used any kind of non-cash payment instrument. Less than 3% of the value transacted used cards in the year ending March 2014. The growth in value of ATM transactions had far outpaced the growth in the value of card payment transactions. Moreover, in India, the total value of ATM transactions increased more than five times between 2007 and 2012, from about 3 trillion to about 18 trillion rupees, while the value of card transactions barely doubled in the same period from 1 to 2 trillion rupees. Despite the improvement in telecommunications, India lagged its peers in mobile payments. Fewer than 2% of Indians had used a mobile phone to receive a payment, compared to over 60% of Kenyans and 11% of Nigerians. Financial inclusion policies are bank-led rather than telecom-led. Much of India’s recent approach has focused on the supply side of financial inclusion. The priorities of the Reserve Bank (RBI), India’s central bank, are to promote safe, efficient, accessible, inclusive, interoperable, and robust payment systems. India has addressed these priorities both through the creation of national champions, such as the National Payments Corporation of India (NPCI) and its subsidiaries. The result is that India has built the capacity to clear and settle payments. Access to that infrastructure on a sustainable and profitable basis is a key reason behind India’s investment in universal identification (known as Aadhaar)-enabled payments services. The problem is that RBI chose a bank-led model over a telecoms-led one to achieve its financial inclusion goals. As a result, telecoms firms had only recently been allowed to enter the payments space in India, and were limited only to partnerships with banks. Compare this situation to that of Kenya, for example, where a surge in mobile payments has been engineered by the efforts of Safaricom, the major telecom company. The net result of a bank-led approach has been an insufficient investment in the necessary digital infrastructure and inadequate marketing of its potential uses and benefits. Consumers have been left unaware of how they might use mobile phones for services other than communications, texting, or Facebook.
The costs of cash to the Indian consumer are among the highest in the world. In our analyses of the cost of cash across over 70 countries, we found that the cost of cash to consumers – in terms of time spent to get cash and fees — are high in some of the world’s most populous countries. Unsurprisingly, cost to Indian consumers was among the highest. When weighted for population, India fared poorly in terms of ATM access compared to even lesser-developed countries, such as Kenya, Nigeria, or Egypt. Moreover, smaller cities in India had larger problems. Long before the current crisis, we found that residents of Delhi spent 6 million hours and $1.5 million to obtain cash, while residents of Hyderabad spent 1.7 million hours and $0.5 million to do the same. Hyderabadi consumer costs were about twice as high as that of Delhiites on a per capita basis. With this structural understanding in mind, how do we evaluate the potential impact of the demonetization move in getting digital payments past a tipping point? I would argue that, despite the high costs of cash, telling people – as the prime minister did — to go cashless is putting the cart before the horse. The horse in this case is the digital infrastructure and establishing a threshold of trust in the system; beefing up this digital ecosystem should come first. India’s digital state (it ranked 42nd out of the 50 countries we studied in our Digital Evolution Index), does not engender the threshold of trust needed for cashlessness to take hold in a meaningful way. Despite a billion mobile phone subscriptions, just about 30% of Indian subscribers use smartphones. A little over a third of the population has internet access. India lacks infrastructure needed to reliably expand access. Connections are patchy and unreliable and there is great disparity in connectivity: 70% of those with mobile internet access are in cities; only 17% of Indian women use the internet, according to the Pew Research Center. With women responsible for much of household purchases, this does not provide a strong foundation for the spread of digital payments where it really counts. According to Google India and The Boston Consulting Group, by 2020, digital transactions will happen at 10 times the current level. That may well come to pass; maybe demonetization may serve as the needed catalyst. But let us be clear: in the absence of a systematic and concerted investment in digital infrastructure and Internet access, cash will stubbornly resist wholesale digital displacement. It is useful to keep in mind that any form of currency, cold hard cash or digital, involves an “equilibrium mindset” — a mutually self-reinforcing logic — whereby the parties across a transaction must share a belief in the currency and trust that it works and holds value. If there is a shadow of doubt that affects one party’s trust in a particular form of currency, the other will prefer to not rely on it. Cash, unlike digital alternatives, has the benefit of being acceptable (almost) everywhere. If there is concern about the viability or acceptability of digital payments, venturing forth without cash will make consumers feel insecure. When we studied current habits in India, in the Cost of Cash in India, we found that there is great level of comfort in keeping moderate to significant levels of cash in hand, especially in small towns and rural areas. Even credit card users keep significant amounts of cash in hand, and they keep higher balances. The proportion of respondents who keep more than 2,000 rupees as minimum cash in hand is 29% in case of credit card users, as compared to 12% in case of cash-only users. The average amount of minimum cash carried by cash-only users or “debit cash and cash” users is relatively lower than the amount carried by credit card users. The proportion that carried minimum cash in the range of 100 – 500 rupees was 13% among credit card users, as compared to 27% among the cash users. What seems like a major push from physical to digital money will, in reality, happen at a slow pace. While I do not intend to demonize the demonetizers, this unfortunate crisis is a case study in poor policy and even poorer execution. Unfortunately, it is also the poor that bear the greatest burden. Editor’s note: We clarified how money that’s deposited in banks is considered legitimate.
Bhaskar Chakravorti is the Senior Associate Dean of International Business & Finance at The Fletcher School at Tufts University and founding Executive Director of Fletcher’s Institute for Business in the Global Context.
Sunday, December 18, 2016
Tuesday, December 06, 2016
The curious case of Trump and COI
Conflict of interest (COI)
''a situation in which a person is in a position to derive personal benefit from actions or decisions made in their official capacity.
By electing Trump the United States has inherited an unique problem which has not happened in a democracy before. Usually all democratic leaders are either ideologues or claim to be one with apparent benefits from corporates post their official capacity . Trump on the other hand is a billionaire first and then had a side mission to become a president which suddenly became his main storyline.
How much does he love money? - Well he is more protective of maintaining is billionaire credentials than the fear of being called a misogynist, racist , bigot among other things. Why do you think Trump is still refusing to disclose his tax returns. How insecure an individual must be on the fear of being disclosed as a millionaire rather than a billionaire.
For Trump showcasing his economic success is everything. Given all that how important is the presidency for him ?
Look at the article from politico below
Bahrain has just booked at Donald Trump's new Washington hotel.
As ethics lawyers warn about potential conflicts of interest facing the billionaire businessman's presidential administration, the kingdom reserved space for a reception at the president-elect's flagship property less than a mile from the White House, according to an invitation from the country's embassy obtained by POLITICO on Tuesday.
On the occasion of the forty fifth national day of the Kingdom of Bahrain and the seventeenth anniversary of his majesty King Hamad bin Isa Al Khalifa’s accession to the throne,” the invitation begins, “Ambassador Abdulla Al Khalifa cordially invites you to a national day reception on Wednesday, December 07, 2016 from 12:00 to 2:00 PM.”
A Trump International Hotel representative declined to confirm the details of the event. “It’s always been a policy of Trump that we never ever discuss individual guests or groups in the hotel,” the sales and marketing official told POLITICO.
News of the reception drew an immediate rebuke from Richard Painter, one of several legal experts who has been sounding alarms over the possible conflicts presented by the unprecedented scope and scale of the incoming president's business interests.
Painter, President George W. Bush’s chief ethics lawyer, said a foreign government making payments to Trump’s businesses while he is president would violate a provision of the Constitution called the foreign Emoluments Clause.
The clause bars officials from accepting gifts from foreign powers without congressional approval, Painter said, adding that a diplomat staying at a Trump hotel to get in his good graces would qualify as one.
Whether the Bahrain reception, set to take place a month before Trump’s inauguration, would violate the Constitution depends on whether the payments are made before or after Jan. 20, Painter argued. Regardless, he maintained that it raises serious concerns, and the only solution is for Trump to sell the hotel — either to his children or another buyer.
“The point is, this is not where we want to go,” Painter said. “This is a concern. This is not where we want to go.”
Next week’s event won’t be the first example of the blurred lines between the president-elect and the businessman who has yet to relinquish his business empire, though.
Roughly 100 foreign diplomats drank Trump-branded champagne at Trump International Hotel earlier this month as they took in a sales pitch about the hotel, according to a Washington Post report published Nov. 18.
But the ethical dilemmas existed even before he was elected president. And Trump — who still hasn’t released his tax returns and is the target of Democrats in Congress who are requesting a review of his financial arrangements for possible conflicts of interest before he’s sworn in as president — hasn’t taken any actions to ease such concerns.
Before Trump’s election, Filipino President Rodrigo Duterte had already named Jose Antonio, Trump’s business partner, a special envoy to Washington for trade, investment and economic affairs. Antonio’s company, Century Properties Group, is building a $150 million, 57-story Trump Tower apartment building in Manila.
And in India, Trump’s business partners — Pranav Bhakta and Atul Chordia — are developing a pair of 23-story Trump Towers buildings in Pune. The two met with Trump at Trump Tower in New York after his election.
In an interview with New York Times reporters and editors last week, Trump said “the law is totally on my side” because, as president, he’s exempt from conflict-of-interest policies that apply to lower-level officials.
“Despite that, I don't want there to be a conflict of interest anyway,” Trump said then. “And I understand why the president can’t have a conflict of interest now because everything a president does in some ways is like a conflict of interest, but I have, I’ve built a very great company and it’s a big company and it’s all over the world.”
Trump has promised to turn over control of his company to his adult children, but has yet to provide any details or timeline for how this might work.
And even as he continues to speak with foreign leaders and hold daily meetings with current and former elected and administration officials as he works to fill out his government, he still holds meetings with business leaders and has his adult children take part in both realms.
But what penalty, if any, would face President Trump is unclear. Experts generally agree that the mechanism for enforcing the conflict-of-interest clause would be impeachment, which is unlikely given the makeup of Congress. But Painter suggested that electors who will formally cast ballots for president next month could demand that Trump assure them he will eliminate payments from foreign governments as a condition of voting for him.
“At some point, he has to be told to follow the Constitution,” Painter said, adding that Trump is “just wrong” to think a president can't have a conflict of interest.
“If he thinks he’s above the law,” Painter warned, “he’s going down a very dangerous path.”
''a situation in which a person is in a position to derive personal benefit from actions or decisions made in their official capacity.
By electing Trump the United States has inherited an unique problem which has not happened in a democracy before. Usually all democratic leaders are either ideologues or claim to be one with apparent benefits from corporates post their official capacity . Trump on the other hand is a billionaire first and then had a side mission to become a president which suddenly became his main storyline.
How much does he love money? - Well he is more protective of maintaining is billionaire credentials than the fear of being called a misogynist, racist , bigot among other things. Why do you think Trump is still refusing to disclose his tax returns. How insecure an individual must be on the fear of being disclosed as a millionaire rather than a billionaire.
For Trump showcasing his economic success is everything. Given all that how important is the presidency for him ?
Look at the article from politico below
Bahrain to host event at Trump's D.C. hotel, raising ethical concerns
Ethical dilemmas existed even before Trump was
elected. But the president-elect hasn’t taken any actions to ease
concerns.
Bahrain has just booked at Donald Trump's new Washington hotel.
As ethics lawyers warn about potential conflicts of interest facing the billionaire businessman's presidential administration, the kingdom reserved space for a reception at the president-elect's flagship property less than a mile from the White House, according to an invitation from the country's embassy obtained by POLITICO on Tuesday.
On the occasion of the forty fifth national day of the Kingdom of Bahrain and the seventeenth anniversary of his majesty King Hamad bin Isa Al Khalifa’s accession to the throne,” the invitation begins, “Ambassador Abdulla Al Khalifa cordially invites you to a national day reception on Wednesday, December 07, 2016 from 12:00 to 2:00 PM.”
A Trump International Hotel representative declined to confirm the details of the event. “It’s always been a policy of Trump that we never ever discuss individual guests or groups in the hotel,” the sales and marketing official told POLITICO.
News of the reception drew an immediate rebuke from Richard Painter, one of several legal experts who has been sounding alarms over the possible conflicts presented by the unprecedented scope and scale of the incoming president's business interests.
Painter, President George W. Bush’s chief ethics lawyer, said a foreign government making payments to Trump’s businesses while he is president would violate a provision of the Constitution called the foreign Emoluments Clause.
The clause bars officials from accepting gifts from foreign powers without congressional approval, Painter said, adding that a diplomat staying at a Trump hotel to get in his good graces would qualify as one.
Whether the Bahrain reception, set to take place a month before Trump’s inauguration, would violate the Constitution depends on whether the payments are made before or after Jan. 20, Painter argued. Regardless, he maintained that it raises serious concerns, and the only solution is for Trump to sell the hotel — either to his children or another buyer.
“The point is, this is not where we want to go,” Painter said. “This is a concern. This is not where we want to go.”
Next week’s event won’t be the first example of the blurred lines between the president-elect and the businessman who has yet to relinquish his business empire, though.
Roughly 100 foreign diplomats drank Trump-branded champagne at Trump International Hotel earlier this month as they took in a sales pitch about the hotel, according to a Washington Post report published Nov. 18.
But the ethical dilemmas existed even before he was elected president. And Trump — who still hasn’t released his tax returns and is the target of Democrats in Congress who are requesting a review of his financial arrangements for possible conflicts of interest before he’s sworn in as president — hasn’t taken any actions to ease such concerns.
Before Trump’s election, Filipino President Rodrigo Duterte had already named Jose Antonio, Trump’s business partner, a special envoy to Washington for trade, investment and economic affairs. Antonio’s company, Century Properties Group, is building a $150 million, 57-story Trump Tower apartment building in Manila.
And in India, Trump’s business partners — Pranav Bhakta and Atul Chordia — are developing a pair of 23-story Trump Towers buildings in Pune. The two met with Trump at Trump Tower in New York after his election.
In an interview with New York Times reporters and editors last week, Trump said “the law is totally on my side” because, as president, he’s exempt from conflict-of-interest policies that apply to lower-level officials.
“Despite that, I don't want there to be a conflict of interest anyway,” Trump said then. “And I understand why the president can’t have a conflict of interest now because everything a president does in some ways is like a conflict of interest, but I have, I’ve built a very great company and it’s a big company and it’s all over the world.”
Trump has promised to turn over control of his company to his adult children, but has yet to provide any details or timeline for how this might work.
And even as he continues to speak with foreign leaders and hold daily meetings with current and former elected and administration officials as he works to fill out his government, he still holds meetings with business leaders and has his adult children take part in both realms.
But what penalty, if any, would face President Trump is unclear. Experts generally agree that the mechanism for enforcing the conflict-of-interest clause would be impeachment, which is unlikely given the makeup of Congress. But Painter suggested that electors who will formally cast ballots for president next month could demand that Trump assure them he will eliminate payments from foreign governments as a condition of voting for him.
“At some point, he has to be told to follow the Constitution,” Painter said, adding that Trump is “just wrong” to think a president can't have a conflict of interest.
“If he thinks he’s above the law,” Painter warned, “he’s going down a very dangerous path.”
Sunday, December 04, 2016
Is westworld better than GOT
Entering the final episode of Westworld on Monday I feel like it has outperformed the other flagship HBO series GOT. At the ery least it has clearly outperformed the first 2 seasons. There is no comparison in the acting and script as succinctly out by the Cnet columnist David priest below
"Game of Thrones" has some spectacular moments, but the core experienceThree months ago, the premiere of HBO's "Westworld" was followed by a slew of articles comparing it to HBO's biggest show: Is it the new "Game of Thrones"? Is it better or worse? Is it more or less lucrative? The comparison stuck. As recently as mid-November, The New Yorker of all places published an article titled, "The Latest 'Westworld' Reveal Shows It's No 'Game of Thrones.'" What is wrong with how we watch TV?
Of course "Game of Thrones" has more complex settings, character arcs and narratives than "Westworld" -- it's been on the air for six seasons! And of course HBO's newly minted series will never replicate the fantasy sprawl of "Game of Thrones" -- it's not trying to. The problem is, when the critics' first impulse is to compare every new ambitious show to whatever seems popular, they miss the point.
No matter what you think of "Game of Thrones," "Westworld" is doing something special: It's changing viewer expectations for TV quality. It's a show everyone should watch, a show you should watch, for the magnificent cinematography, the spring-loaded story, the editorial wizardry. You should watch for stars Anthony Hopkins, Thandie Newton, Jeffrey Wright and Evan Rachel Wood. You should watch to introduce your brain to its own limits. "Westworld" holds fire in its belly, and by some magic, it blows no smoke.
"Westworld" bends the rules. Watching it is totally different from almost any other television show available now. Its editing keeps viewers on their toes, surprising us with revelations from the past when we thought we were watching the present. The cinematography constantly pulls us back and forth from stunning Western vistas to steel-and-glass sci-fi offices. The visual effects are brutal, and would feel at home in any summer flick at the theater.
The mind-bending, effects-driven story of "Westworld" isn't just the product of a higher budget, it shows creative intention by the showrunners to challenge how we understand any story we watch.
But practically any performance in "Westworld" would steal a season on "Game of Thrones." Hopkins (as the park's creator and mastermind, Dr. Robert Ford) is simply transcendent, even with meager screen time; Newton (as brothel owner Maeve Millay) sells a perilously complicated character arc in a matter of episodes; Jeffrey Wright (as the park's head programmer Bernard Lowe) folds subtlety into a role that could've easily been overplayed; and Ed Harris is irresistible as the Man in Black.
The rest of the cast, especially those who show up for half an episode like Dolores' dad in the first episode, surprise and delight viewers with pathos punctuated by the whirs and stutters of their malfunctioning operating systems. "Game of Thrones" has good acting, but the performances in "Westworld" are next level.
"Westworld," by contrast, takes a unique idea, a futuristic Wild West theme park, inspired by Michael Crichton's '70s flick, and spends 10 episodes spinning out its mysteries for viewers. Sure, any character could die just like in "GoT," but any of them could be human or robot, hero or villain, future or past.
What you get with "Westworld," much like the special effects these puzzles depend on, is an enigma that unfolds to reveal further mystery. And unlike past shows based in such continually unfolding worlds ("Lost" for example), there's a singular end in mind the whole time -- a beating heart in the chest.
Conversations about "Westworld," however, quickly turn to its deeper themes: violence and sexual exploitation in the stories we tell and what those stories say about us; our commoditization of the human experience, and what experience truly makes one human.
Dive a little deeper and you find nuanced commentary on gender, sex and race, and how they all shape the roles we're given. Suddenly, after rejecting her role as a prostitute and unshackling her mind from the code that limits her intellect, Maeve's rebellion is all the more powerful. The questions "Westworld" asks viewers don't just matter inside its own universe, they matter deeply to us.
I believe it is special especially for a gamer like me.
"Game of Thrones" has some spectacular moments, but the core experienceThree months ago, the premiere of HBO's "Westworld" was followed by a slew of articles comparing it to HBO's biggest show: Is it the new "Game of Thrones"? Is it better or worse? Is it more or less lucrative? The comparison stuck. As recently as mid-November, The New Yorker of all places published an article titled, "The Latest 'Westworld' Reveal Shows It's No 'Game of Thrones.'" What is wrong with how we watch TV?
Of course "Game of Thrones" has more complex settings, character arcs and narratives than "Westworld" -- it's been on the air for six seasons! And of course HBO's newly minted series will never replicate the fantasy sprawl of "Game of Thrones" -- it's not trying to. The problem is, when the critics' first impulse is to compare every new ambitious show to whatever seems popular, they miss the point.
No matter what you think of "Game of Thrones," "Westworld" is doing something special: It's changing viewer expectations for TV quality. It's a show everyone should watch, a show you should watch, for the magnificent cinematography, the spring-loaded story, the editorial wizardry. You should watch for stars Anthony Hopkins, Thandie Newton, Jeffrey Wright and Evan Rachel Wood. You should watch to introduce your brain to its own limits. "Westworld" holds fire in its belly, and by some magic, it blows no smoke.
A story deconstructed
it offers isn't game-changing. The story moves forward at a predictable pace, the world is believable, the characters feel real -- it meets all the standards we expect out of contemporary stories."Westworld" bends the rules. Watching it is totally different from almost any other television show available now. Its editing keeps viewers on their toes, surprising us with revelations from the past when we thought we were watching the present. The cinematography constantly pulls us back and forth from stunning Western vistas to steel-and-glass sci-fi offices. The visual effects are brutal, and would feel at home in any summer flick at the theater.
The mind-bending, effects-driven story of "Westworld" isn't just the product of a higher budget, it shows creative intention by the showrunners to challenge how we understand any story we watch.
An actor's paradise
Award-caliber performances aren't new to HBO, but much of its best acting has been in less popular fare, such as "Show Me a Hero" or "The Night Of." "Game of Thrones" is a different beast, with a massive yet surprisingly consistent cast. But that leaves only a few standouts (namely: Lena Headey, Peter Dinklage and Jonathan Pryce). And even the best performances take time to really connect: Headey and Dinklage (as Cersei and Tyrion Lannister, respectively) don't get a chance to show real complexity for a few seasons, and other great actors don't show up till later in the series.But practically any performance in "Westworld" would steal a season on "Game of Thrones." Hopkins (as the park's creator and mastermind, Dr. Robert Ford) is simply transcendent, even with meager screen time; Newton (as brothel owner Maeve Millay) sells a perilously complicated character arc in a matter of episodes; Jeffrey Wright (as the park's head programmer Bernard Lowe) folds subtlety into a role that could've easily been overplayed; and Ed Harris is irresistible as the Man in Black.
The rest of the cast, especially those who show up for half an episode like Dolores' dad in the first episode, surprise and delight viewers with pathos punctuated by the whirs and stutters of their malfunctioning operating systems. "Game of Thrones" has good acting, but the performances in "Westworld" are next level.
Wild, wild West(eros)
The world of Westeros in "Game of Thrones" is a fascinating setting, full of intrigue and secrets. But within the first few episodes, the most critical of these secrets are revealed. We know the White Walkers are coming (very, very slowly); we know who killed the King's Hand and Robert Baratheon. We understand the basic rules of this show because we've seen worlds like Westeros before. It's another fantasy world based on late Medieval European history -- not bad, but not new or particularly distinctive."Westworld," by contrast, takes a unique idea, a futuristic Wild West theme park, inspired by Michael Crichton's '70s flick, and spends 10 episodes spinning out its mysteries for viewers. Sure, any character could die just like in "GoT," but any of them could be human or robot, hero or villain, future or past.
What you get with "Westworld," much like the special effects these puzzles depend on, is an enigma that unfolds to reveal further mystery. And unlike past shows based in such continually unfolding worlds ("Lost" for example), there's a singular end in mind the whole time -- a beating heart in the chest.
These violent delights'
During the sixth season of "Game of Thrones," I placed bets with friends and family on characters' mortality -- how and when they'll die. It was one of the most enjoyable seasons of TV I've experienced. But aside from predicting plot lines and the demise of characters, conversations about "Game of Thrones" rarely transitioned to anything more substantive. Why? Because it is so predictable: The universe is brutal, and people are brutish. Thematically, "Game of Thrones" is a Thomas Hobbes wet dream, set in the Dark Ages with dragons.Conversations about "Westworld," however, quickly turn to its deeper themes: violence and sexual exploitation in the stories we tell and what those stories say about us; our commoditization of the human experience, and what experience truly makes one human.
Dive a little deeper and you find nuanced commentary on gender, sex and race, and how they all shape the roles we're given. Suddenly, after rejecting her role as a prostitute and unshackling her mind from the code that limits her intellect, Maeve's rebellion is all the more powerful. The questions "Westworld" asks viewers don't just matter inside its own universe, they matter deeply to us.
'Now entering...'
"Westworld" might just keel over after season one, like "True Detective" did, or it might turn into a massively successful super-series. But debating its future as a show, or how it compares to other shows, kind of kills the magic. So when the "Westworld" finale airs this Sunday on HBO, I won't be thinking about "Game of Thrones," I'll enjoy an hour and a half of TV that's like no other show I've watched before.I believe it is special especially for a gamer like me.
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