That happened: 10 big business stories that defined 2018

C2 team
That happened: 10 big business stories that defined 2018

The year 2018 gave the business world plenty to think and talk about. The broad spectrum of inspiring, bewildering, groundbreaking and, in some cases, downright alarming narratives that played out over the course of the last 12 months paints a pretty good picture of where we’re at in our relationship to technology, how our commercial habits are changing and where world leadership and power is heading.

The following is a roundup of some of the truly year-defining stories that caught our attention in 2018.

 

10. Trade Wars: The Empires Strike Back

In July, citing unfair trade practices and theft of intellectual property, President Trump fired the first salvo in what is now a full-blown trade war between the world’s two largest economies. Thus far, the U.S. has placed tariffs on $250 billion worth of Chinese products and have threatened $267 billion more. Due to the trade imbalance, China has maxed out its tariff retaliation at $110 billion worth of U.S. goods, but is threatening “qualitative measures” in response to any further American tariffs. Characterized by China’s Ministry of Commerce as the “the biggest trade war in economic history,” collateral damage has been felt as far away as Maine’s lobster fishery and, alarmingly, as close to home as the doctor’s office (China is refusing to share virus samples of influenza strains that are used to develop flu vaccines).

 

9. A new NAFTA agreement, or something

On the topic of testy trade exchanges… It took over a year of often tense negotiations and American threats to Canada of tariffs and separate bilateral deals, but an hour before the September 30 deadline, negotiators finally stuck a fork in Version 2.0 of the North American Free Trade Agreement (NAFTA). The deal was signed by President Trump, Prime Minister Justin Trudeau and Mexican President Enrique Peña Nieto on November 30 at the G20 Summit in Argentina, and it was only a little awkward. And for all that’s agreed upon in the sprawling document, it seems the one thing that proved impossible to agree on was what to call it. In Canada, it’s called the Canada-United States-Mexico Agreement (CUSMA); in the United States, it’s the United States-Mexico-Canada Agreement (USMCA); and in Mexico, it’s the Tratado entre México, Estados Unidos y Canadá (T-MEC). But most importantly, let’s call it done.

 

8. Acquired tastes

Chances are if you wanted it, you got it in 2018. A Deloitte report predicting mergers and acquisitions trends hit the nail squarely on the head when they foresaw a big uptick in the number and size of M&A deals this past year, especially in the tech sector. In fact, 2018 was record breaking, with some $2.5 trillion dollars in M&A deals in the first six months alone, putting it on pace to be the biggest year ever. Among the big fish that got landed: Microsoft acquired software development platform GitHub for $7.5 billion, Walmart grabbed a 77% stake in Indian ecommerce platform Flipkart for $16 billion, IBM scooped up open-source software distributor Red Hat for $34 billion, and AT&T completed its $85 billion acquisition of Time Warner.

 

7. Pot goes legit in the Great White Green North

Oh Cannabiz! On October 17, 2018, Canada became the first G20 country to legalize the distribution and sale of cannabis and it was a really big deal. The Canadian business case for cannabis captured the world’s attention, with industry forecasters projecting a $20-billion market in the years to come. It’s not every day that an illicit industry goes legit, and in such a big way that we nearly ran out of weed.

 

6. The first pedestrian was killed by an autonomous vehicle*

(* Meanwhile, an estimated 1.25 million people worldwide were killed by regular vehicles)

In March, a self-driving Uber killed a 49-year-old woman in Tempe, Arizona in the first fatal accident involving an autonomous vehicle and a pedestrian in the U.S. Almost immediately, regulatory bodies and the media started pointing fingers, denouncing the technology as a danger to society. This happens every time an autonomous vehicle crashes, yet just last year, more than 40,000 people died in car accidents in the United States alone and roughly 94% of car accidents are caused by human error. The implications of the accident could be far-reaching considering, as Forbes observed, “Virtually every car company, on top of tech companies like Apple and Google, are testing autonomous driving with the idea that the technology will be mature enough to roll out broadly to the public by 2025.”

 

5. And Musk mayhem ensued…

And what would a conversation about the auto industry be without Tesla/SpaceX founder Elon Musk, who managed to monopolize — for better and (mostly) worse — the conversation. SpaceX’s first successful, and utterly captivating, Falcon Heavy rocket launch in February would provide the high point, both literally and figuratively, of Musk’s year… though it will likely be remembered mostly for the Tesla Roadster he sent sailing out into space.

The spring announcement of a shortfall in Tesla Model 3 production kicked stocks where it hurts, prompting Musk to move into his Fremont, California Tesla Factory to right the ship, and where he slept on a couch. In August, Musk tweeted that he was taking Tesla private at $420 a share, which caught the attention of shareholders (happy) and U.S. securities regulators (not so much). In September, he was charged by the U.S. Securities and Exchange Commission for making misleading statements, and shortly after reached a settlement with the SEC that saw Musk and Tesla fined $20 million each. And because apparently September wasn’t exciting enough, Musk then smoked a joint during an interview on The Joe Rogan Experience podcast, which saw Tesla stock take another nosedive and prompted the departure of Tesla’s Vice President of Worldwide Finance.

And we didn’t even mention the $500 flamethrower.

 

4. Brick and mortar meltdown

The carnage of the so-called “retail apocalypse” continued unabated in 2018, with J.C. Penny, Gap, Macy’s, Guess?, Urban Outfitters, Victoria’s Secret and Michael Kors among the many staple retailers who continued to shed locations this year. And, of course, the complete demise of one-time powerhouse Toys “R” Us in the U.S., and of Sears in Canada. These latter are among the traditional anchor outlets that malls depend on for survival. Of the estimated 1,200 malls in the U.S., only 50% are expected to be in business by 2023 (which will require a shift in thinking when it comes to repurposing that space.) There is one bright spot, however: Blockbuster is still hanging in there with a lone remaining store holding the fort in Bend, Oregon.

 

3. Minimum wage takes centre stage

In terms of power to the people, hourly wage became a hot topic at the close of 2018, with Seattle, Missouri and Arkansas, along with 10 other states and cities, experimenting with an increase. As NPR put it, “The Ins and Outs of Minimum Wage” are “more complicated and multifaceted than many people realize.” The good news here is that “early evaluations have found fears of widespread job loss to be mostly unfounded,” according to CNN Business. Economists also agree that raising the minimum wage reduces poverty. In Canada, however, the recently elected Conservative government in Ontario passed sweeping labour reforms that froze the minimum wage at $14, nixing the previous Liberal government’s plan to raise it to $15.

 

2. The escalation of the “techlash”

From the Amazon “all-hands” meeting that saw employees raising concerns over the company’s facial recognition deals with law enforcement, to the Google walkouts over sexual harassment, to Facebook’s very public fall from grace, it was a bad year for big tech. At Facebook, the Cambridge Analytica scandal saw CEO Mark Zuckerberg summoned to a highly publicized Senate hearing, and it also had to get in front of its human rights impact in Myanmar, concluding that they have not been “doing enough to prevent the platform from being used to foment division and incite offline violence.” In response to Cambridge Analytica, the company overhauled its privacy controls, introduced a new way for users to access copies of their data, and rewrote their terms of service to better explain how it uses data.

Meanwhile, in Silicon Valley, Prop C — a first-of-its-kind corporate tax on big tech to curb social inequality — was passed in San Francisco. The tax will double what the city spends annually on its growing homeless population.

 

1. Women (still) mean business

This was another unforgettable year for women, as the fallout from 2017s #metoo movement continued to be felt. The confirmation of Brett Kavanaugh to the United States Supreme Court, despite the Senate testimony of Christine Blasey Ford alleging that he had sexually assaulted her decades before, gripped the political world and galvanized feminist allies. American women responded by making history in the midterm elections, breaking records in both the House and Senate. The tech world, rocked by sexual scandals of their own (as noted above), also made waves by encouraging the rising power of women in the industry. California, for example, became the first state to require companies like Apple, Facebook and Alphabet to add more women to their boards. Meanwhile, Microsoft improved its representation of women in intern classes, technical roles and senior leadership. We like where this is going…

 

Questions or comments? What story do you think should have also made the list? Drop us a line at editorial@c2.biz