In Q3 slot my focus was to increase my basis about the Wardley Maps. I have translated the book into Spanish and I have started a set of maps related to gameplays.
During this quarter I would like to increase this knowledge with more examples and practical work. The big challenge to me is not going to be able to generate content, but to increase the number of people having conversations about it.
Vision: create real examples to cover the main axis of the maps: climate patterns, doctrines and gameplays.
Values: have fun, learn the details of the different people about it.
Method: create content and publish it on different places, combine the use on investment purposes.
Obstacles: Time, Ariel’s surgery.
There are 30 climatic patterns, complete at least 20 examples of climate patterns.
There are 40 doctrines, complete at least 30 examples of doctrines.
There are 63 gameplays, complete at least 41 examples of gameplays.
Be able to attract some attention of this knowledge.
On this post I want to review several types of gameplays that Simon Wardley proposes on his book.
This post is the first one of entries I want to write about gameplays used in Wardley maps. I would like to write about simple examples that enable people to understand how the gameplays work and enable conversations with all of you.
On this one, I will use a situation that is taking place in 2020: the payment war in the mobile App ecosystem.
There are 3 companies that have created their own application ecosystems, enabling other companies to publish their applications in these environments and generate profits as long as the payments are made through the marketplace that these companies created. These companies are: Alphabet, Apple and Tencent.
These ecosystems are very useful, and very rich, they provide a programming language, development environments, test and production environments, a set of market rules and many other components. All this have enabled the creation of millions of applications and the creation of several companies.
These markets are highly valued assets for these large companies and are very lucrative, so any attack on this side of the moat will have an answer.
When you buy in one of these marketplaces, payments are made through it, and there is a percentage that the market itself keeps for itself. At the time of writing this article that percentage is 30%.
If you are a small company, you just have to understand that this is the case, and count it as part of the rules of the game, so you just forecast that it is a cost in your P&L. As small player, this market allows you to reach a huge number of users and the cost of reaching them would be more than 30% of turnover.
But if you are a large company, you are also willing to try to break some of the things established in these markets (considered by some to be monopolistic). Specially if you are a large company and your product knows itself, why pay 30% per transaction?
Is it a lot or a little for Apple?
If we look at Apple’s third quarter results we can find this table:
On the table, we see how services, which mainly come from the App Store, are the second segment that provides more revenue to Apple, after the iPhone.
The reference map
Well, let’s see how this one goes:
BATTLE FOR DIRECT PAYMENTS
August 2020, the beginning of the battle
Payment management is one of the characteristics of this market place, and it’s during the upload process to the app store when quality checks are done.
The quality processes of the app store checks if payments are made through the Apple payment gateway or if it is redirected to another site.
Apple and Alphabet detected that the Fornite application, belonging to the Epic Games company, was skipping the payment gateway, and announced that they were freezing Fornite updates to the latest published version of Fornite, not allowing new downloads or updates.
To put it in context, Fornite has 116 million users through Apple who suddenly cannot update their application, cannot be uninstalled and reinstalled, and also do not allow new installations.
Visually the situation is such that:
On one hand Apple offers a payment through its gateway, retaining a percentage of the billing, on the other hand Epic Games tries to obtain the payment directly.
The hordes of lawyers on both sides showed up, on one hand Epic Games sued Apple’s veto, and on the other hand Apple replied that Epic Games is skipping an agreement that they signed. They claim that the retained revenue is used for covering the costs of the market place.
October 2020, Google temporary gives up in India to 150 Indian start-ups
As we can read in this article, Google has been pressured by some 150 Indian companies that use the play store to publish their applications. They have pressed so that the 30% fee that Google wants to impose does not go forward.
Google intends to collect 30% of payments globally in September 2021. Well, it will postpone the application of the policy only in India until April 2022.
The thing has reached the point where the government has announced the intention to study creating an alternative App Store for India to counteract dependence on Google and Apple.
What kind of plays are we seeing here?
Well, the ones that come to mind for now are:
Move First : Epic Games is moving first against these market places. There are competitors of Epic Games that have not made a move yet, and that are very powerful economically. In the event that Epic Games get something for this daring it would be at an advantage over its direct competitors.
: Epic Games’ offensive move to try to break down the status-quo of the App Store market that imposes a fee that is abusive to them.
Movement restriction : Both Apple and Alphabet have for now restricted the movement of Fornite.
Undermining barriers to entry : What Epic Games is doing is trying to break down a very large barrier to entry that provides Apple with a fairly large revenue line.
Alliances : Apple and Alphabet brought their restriction measure almost jointly. The stakes are high and it would be necessary to watch how aligned these two giants are during this battle.
To put in context with respect to the table of types of known moves:
In yellow the plays put in place by Epic Games, and in orange the plays put in place by Apple
From here, what can we expect?
Alliances: It would not be ruled out for other companies to join forces with Epic Games and join the complaint filed by them.
Los mapas de Wardley es una técnica que lo ayuda a examinar un entorno dado, identificar los próximos cambios que van a ocurrir y ayuda a elegir adecuadamente las acciones a tomar. Al examinar qué se necesita, qué componentes se utilizarán, cuáles son sus dependencias y características, se puede construir una representación visual de su mundo, jugar a juegos hipotéticos y elegir su dirección y las mejores acciones para apoyarlo.
Hace poco me di cuenta que llevo usando esta técnica desde 2013 y que conozco los planteamientos básicos de su uso, pero que echo en falta dos cosas fundamentales:
Ahondar más en los detalles de la técnica.
La inexistencia de una comunidad en español que conozca los mapas de Wardley.
Con ello, me he propuesto traducir parte del contenido de los mapas de Wardley al español, para tratar de mejorar los dos puntos mencionados anteriormente.
Principios y partes de la traducción
El libro, que originalmente está en publicado en medium lo trataré de traducir lo más cercana posible al original, solo adaptando situaciones personales y contenido relevante para aprender sobre esta técnica.
Mapas de ejemplo, herramientas, otros recursos: documentaré algunas cosas que existen e iré añadiendo cosas conforme las vaya usando (mi falta de tiempo es un impedimento importante, ….bueno, como a todos).
1.- A realizar
Buscar plug-in sobre rutas o completar cursos.
Buscar plugín sobre conversaciones.
2.- En progreso
Creación de mapas específicos.
Divulgar la página por las redes y contactos
Hablar con Simon acerca de llevar a cabo este proyecto (hecho).
Crear un entorno donde colgar la documentación (aquí).
The american market (I focus on S&P 500) has recuperated 40% of the value since March where it touch the minimum value.
It’s an impressive “come back” while the macro economy data is showing terrible numbers about unemployment, consumption, industrial production….
The economy and the market are driving themselves in the opposite direction. So, so many questions come to my mind:
Is the market crazy?
is the market completely disconnected from the economy?
are we looking at the right numbers?
Well, Mr. Market does what he wants, and we cannot do anything about it. Disconnected from the economy? I do not think so, maybe there is a bubble, but sooner or later it will adjust. Well, my answers are poor, and it’s basically because I have not a concrete answer to these questions.
The last question: “are we looking at the right numbers?” makes me to go to Value Line Geometric Index
Value Line Geometric Index
This index includes all the american market. For more information the Wikipedia.
“All companies in the Value Line Composite Index are publicly listed on one of the major exchanges listed below. The number of companies in the Value Line Composite Index fluctuates based on factors including: the addition or delisting of the companies on the exchanges themselves, mergers, acquisitions, bankruptcies, and the coverage decisions made by Value Line for the Value Line Composite Index. Value Line’s decisions as to which companies to include are undertaken with the intention to create a broad representation of the North American equity market.
Exchanges in The Value Line Composite Index are:
American Stock Exchange
New York Stock Exchange
Toronto Stock Exchange
Well, comparing the VALUG (blue) with SPX (red), you can see that Value Line Geometric Index is more closed to the reality that I had in mind that is that we still have not recuperated.
If we look the comparison of the indexes from February 12th, the result is that draw-down is bigger for VALUG, and that the recuperation is below than S&P:
Update on 07/August/2020
The Value line has crossed over the 200 days SMA for the second time. This is an interesting point of intersection.
This event happened in June and the market reacted for few days. These days the FED did not use big amount of money on POMO.
To do: I will add this index to my reviews, I have first to learn from it.
I have the purpose of counting US drilling rigs that are producing oil. I understand so many of them are closing and the cost to re-open them should be considerable. With the amount of oil in the market and the future prices sinking into even negative values, I want to challenge my self if I can improve the way to analyze and predict when the barrel price is going to bull again.
I have started to follow-up the Dark Index Vs SPX, as one of the indicators I follow during the decisions. Right now it’s in test mode, as I have to learn about what happens and see if I can build some type of correlation that contributes in a positive way to my trading actions.
So, let’s start.
First chart (January 1st – April 30st)
When DIX is up, it’s assumed the whales are buying in a silent way. Some trends:
Second chart (January 1st – June 8th)
Strong concentration of buyers starting on May 21st and continuing during 1 week (over 50%).
SPX was in a channel (2800 -2950), between April 14 and May 26th.
GEX review on June 8th
Gamma Exposure Index < 0 was a risk zone. Started on February 24th.
During the channel (2800-3000) no clear behavior.
GEX review on July 8th
So much ups and downs (accelerate and brake).
DIX review on July 8th
Nothing to add here related to DIX during June.
DIX review on August 8th
Channel 3.000-3.200 has been broken, now working between 3.200-3.400.
Dark Index moving around 45%.
GEX review on August 8th
2 strong “push” to the accelerator put the S&P over 3.300.
GEX review on August 18th
GEX reachs 131.000.000.000.000 units, which means the highest value of this indicator since it was created. It’s the major “brake” to the use of dark pools ever.
DIX review on October 13th
DIX values are similar to the values taken in March (below 37%).
GEX review on October 13th
in the last week, the highest values in GEX means that the major buyers are using the “break” and the purchases are slowing down. On October 13th the highest seen: 153.455.662.942.850.