Fortnite's #freefortnite War against Apple - A Game Theory Perspective
And seven other powerful ideas.
|Jitha Thathachari||Aug 16, 2020|
Hope you and yours are keeping safe (and sane).
I'm back again with the most thought-provoking articles I've read in the week.
I missed last week’s newsletter because I had a horrible back spasm, and was in bed through the weekend. But back to normal fare this week.
If you’re new here, don’t forget to check out the compilation of my best articles: The best of Jitha.me. I’m sure you’ll find something you like.
This week, we first talk about Fortnite’s ongoing tussle with Apple. Apple bans Fortnite from the App Store, Fortnite releases a parody video and a lawsuit… what’s going on? Turns out, it all makes sense from a game theory perspective. And you can also predict the outcome.
Next, a few powerful ideas from Morgan Housel, on life, learning, and investing. Timeless.
And last, some link love and food for thought.
Here's the deal - Dive as deep as you want. Read my thoughts first. If you find them intriguing, read the main article. If you want to learn more, check out the related articles and books.
[PS. If you like what you see, do forward to your friends. They can sign up with the button below.]
1. Fortnite, Apple, and the Fate of the Metaverse - A Game Theory Perspective.
I woke up Friday morning to see this video trending on Twitter.
I thought it was quite epic. Fortnite mocking Apple with a parody of its own iconic Super Bowl commercial from 1984. (See original below if you haven’t).
Now, I don’t play Fortnite, but I have been following the ongoing war (if only of words, until this week) between Epic Games (the maker of Fortnite) and Apple. Epic Games pushing Apple to waive its App Store commissions (a hefty 30%) for Fortnite and its in-app purchases. Apple refusing to budge. Key sector veterans taking sides.
Lots of arguments, nothing substantive.
And then suddenly this week, both players took it up a few notches. Epic sneaked in a Fortnite update breaking Apple’s rules. Apple banned Fortnite. Epic immediately released the video above, and also started a lawsuit and a PR campaign against Apple. Seeing all this, my first thought was: “Such an interesting move!”
Because that’s what this is. One move, in an ongoing battle of wits between the two players.
And like all games, it can be analyzed, to predict the outcome.
At the first level, it raises a lot of questions:
Why would Fortnite, an app with millions of users on iPhone, deliberately break Apple’s rules and force Apple to ban it?
Why did Epic Games reject several win-win outcomes, and go for the jugular?
Why would a billion dollar company (Epic Games) and a trillion dollar company (Apple) not settle their dispute behind closed doors?
But when you look at it from a Game Theory lens, it starts to make sense. And it becomes clear why Epic would voluntarily get itself banned from millions of Apple devices.
As Denzel Washington would say,
(And don’t worry if you don’t know much about Fortnite and the ongoing saga - the article has a quick overview.)
2. Seven Powerful Ideas.
Morgan Housel’s articles are always deeply insightful and thought-provoking. Whether he’s writing about the Laws of Investing, the Psychology of Money, or even just the magic of compounding, he never fails to bring a fresh perspective.
Ideas that Changed my Life is no different. In this, Housel lists seven big ideas that have transformed the way he looks at life and work.
Do check out the article - it’s a quick read.
Some of the ideas that resonated with me:
Everyone belongs to a tribe and underestimates how influential that tribe is on their thinking.
We are all, whether we like it or not, culprits of groupthink.
We hold many opinions, not because we genuinely believe them, but because it’s part of our in-group, our tribe.
As Housel says,
Tribes are everywhere: Countries, states, parties, companies, industries, departments, investment styles, economic philosophies, religions, families, schools, majors, credentials, Twitter communities.
Tribes reduce the ability to challenge ideas or diversify your views because no one wants to lose support of the tribe.
Tribes are as self-interested as people, encouraging ideas and narratives that promote their survival. But they’re exponentially more influential than any single person. So tribes are very effective at promoting views that aren’t analytical or rational, and people loyal to their tribes are very poor at realizing it.
Kevin Simler has written about something similar, in Crony Beliefs. He explains why so many of us (ourselves included) hold so many beliefs that seem strange.
Reason: our tribes.
Self-interest can lead people to believe and justify nearly anything.
Timeless principle to keep in mind. Always worth remembering. Similar to the point above.
This tweet sums it up well:
Room for error is underappreciated and misunderstood.
We apply the concept of “margin of safety” in a very domain-dependent manner.
We apply it in the stock market, but leave too little room for delays in planning important projects.
We include sufficient buffer in our KPIs 😉, but not budgeting for our weddings.
Good to always keep Hofstadter's Law in mind:
It always takes longer than you expect, even when you take into account Hofstadter's Law.
Always. Build. Buffers.
Sustainable sources of competitive advantage.
And last, Housel talks about the most sustainable moats in business and investing:
Learn faster than your competition (or as I wrote earlier, speed as a competitive advantage).
Empathize with customers more than your competition.
Communicate more effectively than your competition.
Be willing to fail more than your competition.
Wait longer than your competition.
3. The World of Books.
This week, I put up my summary of Zero to One by Peter Thiel. Check it out.
It’s a powerful book, that changed how I thought about entrepreneurship.
I’ve shared some of my learnings from this in my articles before. See:
4. And last, some food for thought…
That's it for this week! Hope you liked the articles. Drop me a line (just hit reply or leave a comment through the button below) and let me know what you think.
See you next week!