Good morning! Can a brand own a colour? This question was somewhat at the centre of a legal showdown between face cream rivals NIVEA and Ponds. NIVEA was upset that Ponds salespeople would do live comparisons between the two brands' creams in malls across India. Ponds fired back, saying they used an unbranded blue tub — and NIVEA can't claim the whole blue colour palette, right? This battle, however quirky, lasted for almost three years, and now we’ve a winner. The Delhi High Court ruled that the use of the same shade of blue as that of Nivea’s is a “misleading and disparaging” act. So, for the very least, Ponds’ salespersons have got to let go of the blue tub. 

🎧 Google Search gets a major makeover. Also in today’s episode: NIVEA and Pond’s slug it out over a colour. Tune in on Spotify, Apple Podcasts, Amazon Music, Google Podcasts, or wherever you get your podcasts.

Soumya Gupta, Dinesh Narayanan, and Anup Semwal also contributed to today’s edition.

The Market Signal* 

Stocks & Economy: There is good news and there is bad. The good news is India’s weight in the widely tracked MSCI Emerging Market Index will rise to 19% from the current 18.2% and rival China’s will drop from 25.4% to 25%. That means more inflows into Indian equities. 

In more good news, the weather department now expects the monsoon to hit the southern state of Kerala on May 31. The Indian economy performs well every year that monsoon rains are normal and on time.

The bad news is exports are slowing. Merchandise exports rose a mere 1.07% year-on-year (Y-o-Y) to $35 billion in April even as goods imports rose by 10.25% to top $54 billion, largely due to oil purchases. The trade deficit widened to a five-month high of $19 billion.

Asian markets opened buoyant following US equities. The GIFT Nifty indicates a flat opening for Indian stocks.

MEDIA

Pass The (TV) Remote

Even if you’re one of those ‘cord cutters’, you can’t escape TV. Worldwide, streaming platforms are ditching fierce competition to join hands in ‘bundles’ instead, wooing customers with a larger combined library of original content. 

American telecom provider Comcast is offering a diverse menu bundling Netflix with Apple TV+ and Peacock. Already, Disney and Warner Bros. Discovery announced they were bundling Disney+, Hulu, and Max for all US customers.

In India, Tata Play has added Amazon Prime to its bundle. Besides, it now allows customers to choose six OTT services in their bundle. 

TV redux: Profits in streaming are elusive. Disney’s stock fell last week as growth in streaming was accompanied by a deeper decline in cable TV. Warner Bros Discovery also missed earnings expectations. 

Instead, broadcasters are turning to the old, familiar TV playbook: offering cable TV-like bundles and wooing Madison Avenue to earn more advertising dollars. 

PODCAST

Tune in every Monday to Friday as financial journalist and host Govindraj Ethiraj gives you the most important take on the latest in business and economy.

In today’s episode, he speaks to Hetal Dalal, President & COO, Institutional Investor Advisory Services, about how Indian companies are rotating family members and friends through their boards to escape time limitations.

PROPERTY

Desperate Times, Desperate Measures

If necessity is the mother of invention, audacity is the riposte to crisis. Beijing is mulling a plan to get state-owned enterprises (SoEs) to buy up the massive inventory of unsold homes across the country. The SoEs would purchase them from distressed developers at deep discounts with loans from state-run banks. Some pilots were already done in a couple of provinces last year. 

Home sales in China dropped 47% in 2024 and unsold stock topped 3.6 billion square feet in 2023, Bloomberg reported. 

China’s property crisis began with the 2021 default of real estate giant Evergrande. That toppled the dominoes with Country Garden blowing up in 2023. The latest is Agile Group, which defaulted on its dollar bonds two days ago. 

Meanwhile, Chinese owners of overseas properties are putting them up for sale all over the world, some at steep discounts as they try to generate some cash. 

INTERNET

In Search Of The Golden Goose

Google Search has changed in myriad ways since its formal launch in 1998, but its new avatar will fundamentally change parent company Alphabet’s core business — and the ecosystem it birthed.

Of the several announcements at Google’s annual I/O developer conference, the one that stood out was AI Overview (formerly Search Generative Experience) in the search engine, powered by the company’s large language model, Gemini. Google Search will be more detailed, personalised, and relatively shorn of the blue hyperlinks synonymous with search query results. AI Overview will launch only in the US for now, but when expanded globally, the feature will change how the internet is presented to billions of people. Google accounts for more than 90% of the search engine market.

Google claims AI-assisted Search is best suited for complex queries, including detailed video and voice prompts. Gemini-generated summaries will take precedence over web pages and side panels.

The Signal

With AI Overview, Google is banking on AI to keep users locked in to Search. That presents a threat to virtually every online entity, from hotel aggregators and review websites to content farms and Wikipedia.

It’s not clear how Google intends to monetise AI-powered Search. Advertising, specifically sponsored results and the search engine optimisation (SEO) ecosystem, are its bread and butter. What’s clear is that SEO businesses are breaking into a sweat because they will now have to helm new strategies for discoverability. Given how garbage-infested Search results have become, that may not be such a bad thing… yet.

FYI

Dicey: Amid ongoing elections, India’s government granted citizenship to 14 refugees under the controversial Citizenship Amendment Act; the law was widely protested for discriminating against Muslim citizens. 

Things are getting spicy: The Economic Times reports that Temasek and Bain Capital are competing with the Blackstone-led consortium for a controlling stake in bhujia maker Haldiram’s. Bain-Temasek reportedly submitted a non-binding offer valuing the brand at $8-8.5 billion.

Mine troubles: India’s Director-General of Mine Safety will probe Hindustan Copper mine in Rajasthan after one person was killed and 14 injured in a winding rope accident. 

Ciao bella: Two-wheeler maker TVS Motor has started operations in Italy, launching both electric and conventional scooters and motorcycles. 

Shot but survives: Slovak Prime Minister Robert Fico, who has gradually distanced his country from Ukraine and sidled up to Russia, was shot five times in an assassination attempt on Wednesday. Fico is reportedly out of danger.

THE DAILY DIGIT

6.7%

Unemployment rate for those above 15 years of age in urban India in January-March, 2024, according to the Periodic Labour Force Survey. It was 6.8% in the corresponding period of the previous year. (The Economic Times) 

FWIW

Chill, Jaggu Dada: Jackie Shroff is trying to pull an Anil Kapoor. He wants Delhi High Court to protect his personality and publicity rights. Which is fine, except that he’s also included the usage of the word ‘bhidu’. Shroff’s lawyer told the court that one of the defendants in the petition was running a restaurant named ‘Bhidu’, which is reportedly the actor’s registered trademark. Well, this is a stretch. Sure, Shroff has built his persona as a bindass bhidu, but bhidu is the Marathi word for bro and is used in the same mien as bro is used by English speakers in everyday conversation. What’s next? Will he claim exclusivity rights over gifting people plants? Nah, most likely, he’d claim a trademark over calling them ‘jhaad’. Not fun, bruh.