timw's Profile

Great article – love examples of oil & gas companies implementing new technologies and leading the charge.

My main concern (or watch out) for BP is the cost of being an early adopter. In a commodities industry, there is always a danger to being the first mover, as you often are a price taker, so you must believe implementing this technology first will give you significantly reduced costs vs your peers. Along these lines, I am unsure that some of the “fast followers” in the industry won’t be able to gain the same cost savings at a lower cost of implementation. BP should try and lock in some of the IP they are sure to develop to be sure to hold onto their competitive position in this space.

As a few other commenters mentioned, my primary concern for J&J going forward is their ability to respond to new competitive threats in this industry, particularly in the realm of on-site manufacturing. If a third party is able to release a solution for hospitals to have in house, this could hinder J&J’s ability to remain competitive in this field. Therefore, they should remain diligent when entering this marketplace, keeping an eye on new entrants and using their scale to purchase new threats when appropriate. This would also help their supply chain concerns, and move them to area where they are providing a service rather than having to provide a manufactured product.

To me, the impact of arctic shipping on Maersk will be dependent on whether these new volumes being sent through the new route were originally thought by Maersk to be shipped over more traditional routes. Instead, arctic shipping could be displacing things such as railroads or alternative transportation. If arctic shipping does take share from traditional routes, the market will have to decide if it is worth building new ports to accommodate these routes. Ships are very capital intensive, but the ports they dock in are even more so… therefore this may not have much of an affect on moving trade routes. Ultimately, I believe the headwinds against arctic routes will be so strong over the next 30 years that Maersk should not be affected by this change, but this article certainly raises interesting points!

I’m with Jordan in that I don’t think I buy the premise that these companies are “paying the bill for the entire world”. While this may be a temporary state of being for the industry, free markets will not allow this to continue. If large players are able to provide these new sulfur free delivers in a profitable manner, and small companies are not, the small companies will exit the market. These exits will allow the larger players to raise their prices, which will then open the market back up to new entrants and we’ll reach equilibrium again. Therefore, ultimately these raised costs will be passed on to the end consumer of the products, though I do understand that a few companies may be paying the price for us all while the market adjusts to this new reality.

Very interesting essay.

I think the main tensions here relate to national security and economic development. It is particularly interesting to me that there are European regulations around these data centers – and I am curious as to how many of these EU regulations are related to economic development initiatives (no one wants to be left behind in the cloud computing “revolution”), vs concerns around national security and having access to consumer data when needed.

I believe data should be regulated, but it should be regulated in such a manner that allows for full consumer privacy (including privacy to their governments). If they have to require data centers to be built in country to enforce those regulations, then this is the price of doing business. However, if countries could agree on data protection standards, then there should be no need to build localized data centers if they are not cost effective.

Great article.

To respond to your questions – I believe BMW has an obligation to its shareholders to produce the Mini in the most profit maximizing manner. With the present day uncertainty around Brexit, BMW is right to be hedging their bets and delaying investment. However, I believe they should take more immediate steps to abandon the Brexit opportunity (especially in light of the news Motoaki references above). By going ahead and moving the production facility elsewhere, BMW can beat their competition to finding the largest concessions/etc.