PLAYSTATION VR LAUNCH BUNDLE

Let’s cut to the chase: PlayStation VR should be better. At its best, Sony’s new virtual reality headset manages to conjure the astonishing, immersive wonder of modern virtual reality. Just as often it is frustratingly held back by outdated hardware that can’t quite do what’s being asked of it.

PlayStation VR is Sony’s answer to cutting-edge VR headsets like the Facebook-backed Oculus Rift and the Valve-backed HTC Vive. On paper, it offers much the same experience as its competitors at a lower price, powered not by an expensive gaming PC but by a somewhat less expensive PlayStation 4 console.

I’ve been using the PSVR for the better part of a week and have played a handful of the games that will be available at launch. I’ve been impressed by some things, turned off by others, and made nauseous by a few. Throughout that time I’ve also been disappointed. Sony’s lovely, well designed headset is consistently undermined by inferior motion controllers, an underpowered console, and a lackluster camera.
THE BASICS

PLAYSTATION VR LAUNCH BUNDLE is out next week on October 13. If you buy one, it’ll run you $400 for the headset, or you can opt for the $500 bundle, which includes a couple of Move controllers and a PlayStation camera.

The Move controllers are a known quantity. They came out in 2010 for the PlayStation 3 and work like Wii Remotes. Sony’s push for the Move came and went a long time ago, but the controllers still work with the PS4. The camera is familiar, too—it launched alongside the PS4 and has existed as an odd, underutilized peripheral ever since.

The headset, of course, is new, as is the ambitious attempt to use the PS4 to tie all three pieces of technology together into a coherent VR system. Let’s talk about what this thing does well and what it does less well.

It offers a cheaper, still impressive version of modern VR.

We’ve got three major VR headsets at this point, with more on the way. Each one stands on its own as an entertainment device, and each also makes a particular sales pitch for VR as a new way to experience virtual worlds. While each headset puts its unique spin on that pitch, the basic trajectory remains the same.

VR is fundamentally cool. Once you’ve used one of these headsets, you’ll probably want your friends to see it. At times, it makes you feel like you’re “there.” A giant shark will loom toward you out of dark water, and your adrenaline will spike. You’ll peer out over a precipitous drop and your guts will do a backflip. A cute little critter will run up to your feet and you’ll instinctively try to pet it. You’ll use a motion controller pick up an object off of a nearby table and turn it over in your hand, marveling at how part of your brain really thinks you’re holding it.

PlayStation VR manages all those feats, albeit with more suspension of disbelief required than the competition. It will initially feel familiar to anyone who has tried out an Oculus Rift or an HTC Vive. If you’ve never tried either of those two headsets, you’ll probably be more immediately impressed. You won’t notice the funky head tracking. You won’t mind that your in-game hands are constantly stuttering. You won’t be as put off by the blurry graphics or frame-rate dips.

In fact, there are probably people for whom that will be enough. To its credit, PSVR does convincingly convey the niftiness of modern virtual reality, and it does so powered not by an expensive gaming PC, but by a game console that millions of people already own.
Let’s not kid ourselves. It’s still very expensive.

Most people will have to pay $500 for PSVR, which is the price of the Move + camera bundle. That bundle comes with a disc containing demos of several VR games, as well as PlayStation VR Worlds. You’ll have to buy other games separately.

At $500, PSVR is indeed a more affordable option than the competition. The Oculus Rift costs $600 and will cost even more once its Touch controllers launch later this year. The HTC Vive, which comes with its own handheld controllers, costs $800. Moreover, the Rift and Vive both require powerful gaming PCs that can cost two or three times as much as a PS4, if not more.

But let’s not kid ourselves: A relatively cheap VR headset is still awfully expensive. You could buy a new gaming console for $500 and still have enough cash left over for a few games. You could buy a cutting-edge smartphone and have enough left over for a year of online storage and streaming music. You could buy a secondhand ticket to Hamilton.


One of the best launch games, Super Hypercube, will cost you $30, and most of the other games are in the $20-40 range. The multiplayer tank-wars game Battlezone costs a whopping $60, which certainly seems high for what I’ve played of it.

So, some perspective. PSVR may be the cheapest of the big three VR headsets, but that only means it’s the cheapest of three very expensive things.
It’s pretty easy to set up, but requires some adjusting.

The PSVR isn’t all that difficult to set up. You run a passthrough HDMI cable from the small new PSVR receiver box to your TV, and another HDMI cable to your PS4. You plug a USB cable from the box into your PS4. You plug the headset into the box. You sync the two Move controllers and plug in the camera. You put the camera on top of your TV. You run a quick calibration, and that’s pretty much it.


However, I’ve found that the PS4 can require an annoying amount of adjusting in between games. I’ve yet to find a sweet spot where I can play any game standing up, sitting down, or anything in between. A few times, if I’ve wanted to sit for one game and stand for another, I’ve had to adjust my camera so that my head stays set within a small box. Other games have told me I’m leaned too far back, out of the play area.

You can reset the orientation by holding down the Options button mid-game, which resets the horizontal and vertical orientation of the game. Weirdly, I’ve found that some games begin to rotate ever so slightly to the left or right as I play, an annoyance that the Options button appears powerless to fix. At one point my Battlezone cockpit rotated until I was sitting at an angle on my couch, seemingly unable to make the game point me back forward. It wasn’t until I started a new game that it went back to normal.


When you turn the headset on, your PS4 dashboard immediately pops up in the headset and you’re off to the races. The ease with which I can go from “not playing VR” to “playing VR” is admirable, and makes it much easier to decide on a whim to put on the headset and play some games, or show it to friends I’ve invited over. Whatever annoying calibration steps are required, PSVR does remove a lot of barriers between you and playing a game.

The headset is great.

The headset is a nice piece of electronics, smartly designed and comfortable for extended periods of time. It also plays well with glasses—even my big chunkers—though if given the option I’d still prefer to wear contacts.


Rather than strapping to the front of your face, the PSVR eyepiece hangs down from a plastic halo-hat that goes around the crown of your head. You can easily open the halo by pressing a release button on the back. Once you’ve got it on, you can fine-tune the fit by turning a knob next to the button. You can also press a second button to independently slide the face-mask forward and backward, which makes it a cinch to fit over your glasses without smushing them into your face.

The optics themselves fit comfortably and are framed by soft rubber blinders that gently block out most outside light from around your eyes and nose. It breathes well, and my face rarely feels crowded by the PSVR in the way it often does by other VR headsets. As a bonus, it’s easy to scratch your eye or nose while playing. (Seemingly a small thing, but actually very nice!) I do find that my hair frequently falls down into my eyes and obscures my vision, but I guess I need a haircut anyway.

I can’t tell you exact numbers, but the headset’s field of vision feels open. In a given VR game I rarely noticed the black binocular effect happening outside of the visible area. In-headset visuals are clear, and the blurriness and frame-rate issues some games have are likely more due to underpowered graphics processing hardware than any deficiency in the headset.

India Solar — Unboxing Valuation

Some really interesting developments are taking place in the Indian solar space. Module prices are hardening and there is talk of Discoms reneging on previous high tariff power purchase agreements (PPA) in light of declining tariffs, while developers are reportedly seeking to exit low tariff commitments in light of rising module prices. It’s all happening there!

In such a dynamic and fast evolving eco system, it’s a good idea to step back and address value and valuation — after all, a solid understanding of those constants in the context of solar in India is a handy beacon that guides through still and choppy waters alike.

Figure 1 below provides an illustrative view of solar valuation architecture in tandem with accompanying risks and upside. For primary developers, the key objective of any valuation exercise is to determine tariff that they should bid. Viability of this tariffshould be assessed in relation to pre-operational costs and associated risks vis a vis post operational cash flows (and risks) as well as the potential for upside from an early exit rather than holding the project for the 25-year life of the PPA. Subsequent discounting at the project’s risk reflective cost of capital — which is also the appropriate hurdle internal rate of return (IRR) — provides the answer to the million-dollar question: “How much should I bid?” (Unit tariff for primary developers, total acquisition cost for secondary market developers.)

A lot of any valuation exercise is just simple maths, and indeed solar panels (for example: GOAL ZERO NOMAD 20 ) itself to simplicity in financial modeling like no other generation source. In this context, the fall in tariffs as a (partial) result of factors, such as fall in input (module etc.) costs and decline in interest rates, has been well-documented and these elements are fairly straightforward to model. What is not adequately covered are three fundamental areas which in my opinion are the most critical when it comes to tariff or value decision making and which typically receive little or sometimes even no attention at all in many financial models.

#1: Spread in Cost of Equity (or Hurdle IRR) Between Central and State Discom Offtake

I have written at length about the relationship between Cost of Equity and IRR as well as my view that for operational central offtake (NTPC/NVVN) solar projects the correct hurdle IRR should be built from ground up starting with NTPC’s own cost of borrowing and not derived from some arbitrary thermal derived benchmark. Given that these projects represent zero land aggregation risk (solar parks) and as the tariff payments themselves are arguably senior to the offtaker’s own debt service payments, a small margin on top of cost of borrowing can be a justifiable hurdle rate — which is why tariffs for central offtake are where they are today. It is here that the risk profile of state Discom offtake diverges. On top of the clear risks surrounding land aggregation (which some developers are unfortunately dealing with as I write this) there is also the credit profile of the state Discoms to consider.

As I have also pointed out in another article, the Ministry of Power’s annual “State Distribution Utilities Integrated Rating” does not actually publish “credit ratings” (which is an assessment of an entity’s ability to meet its financial obligations) but rather “gradings” reflecting financial and operational health. What does this mean for determining cost of borrowing for state Discoms? It turns out that getting solid guidance on this is not so straightforward.

For one, to the extent that certain Discoms have historically accessed the bank debt market, it has mainly been with public sector banks, and we all know how those loans have turned out. The pricing and appetite of UDAY (the central government’s big bang program to nurse state Discoms back to health) mandated bond refinance of those loans and is a poor guide. The bonds are state government issued (vs. Discom) and the very fine “across the board” central government mandated 75bps spread at issue over 10-year central government securities belies critical differences in even state specific credit quality. The subscribers as such to these refinance bonds are also no big surprise.

Guesswork on hurdle rates is not good enough anymore; in a competitive tariff bidding environment, models need to take into account the extremely wide spread in true borrowing costs between central and state offtakers

The real test would be if these Discoms were to go out to the private bank/capital markets to assess and price risk appetite for new “no strings attached” credit. With this background, it would not be an exaggeration to say there are some Discoms whose true cost of borrowing could be double or even more of what it costs NTPC to raise money. On top of that there is the land aggregation risk, which persists irrespective of credit rating. That means that all other things remaining constant (module prices, irradiation, etc.) a valuation model should result in state Discom tariffs that are always meaningfully higher than for central offtake and in certain cases double or more (tariff and IRR are not exactly linear in relation, but that’s an altogether separate topic).

It is in this context that while central offtake tariffs are not necessarily irrational, there is a danger of state Discom offtake tariffs flirting with irrational territory as we have seen in 2016 when certain state tariffs appeared to breach comparable central tariff levels. A critical element of any financial mode has to be a detailed build-up of each project’s independent cost of equity starting with a realistic assessment of each offtaker’s credit profile. Guesswork on hurdle rates is just not good enough anymore.

#2: Predicting Generation

One often hears folks say that for solar, top line is everything, which is a pretty sensible way of looking at it. The solar top line is a function of three elements, namely, the amount of sunlight falling on the location where the plant is located (global horizontal irradiance or GHI), the efficiency of the plant in converting GHI into electricity (performance ratio or PR), and the offtaker actually paying for the electricity thus generated. The risk associated with the last element is reflected in point No. 1 above, while the risk associated with lower than expected PR should ideally be contractually mitigated. It is risk associated with the first point regarding GHI that needs to be adequately addressed in a financial model as this is the base resource data from which everything else flows.

In a reverse auction environment for tariff discovery, using aggressive or conservative GHI estimates can both be dangerous

There are a few sources, such as Meteonorm and Solargis, which provide GHI data and recently even the Indian Space Research Organization (ISRO) has begun providing the same. However, this GHI data provided by each source differs even for similar confidence levels. Under the circumstances there is sometimes a tendency to go with “the most conservative (low GHI) number.” In a reverse auction environment, the concepts of aggressive or conservative GHI estimates are equally dangerous — use a conservative GHI number and one is likely to miss out altogether on capacity by bidding too high, while using aggressive GHI numbers will result in lower than expected generation. What is critical is to identify the GHI source and probability that most accurately reflects actual on-the-ground pyranometer readings in the future.

Recent reports of pollution posing a threat to solar returns need to be evaluated in this context. To the extent that predictive GHI figures take pollution into account then the solution is just a more robust O&M process, which won’t necessarily break the bank. However, if on the ground pyranometer readings for GHI are far below what has been estimated at the time of tariff bidding, then I’m afraid there is a pretty big problem for developers — and an even bigger lesson for those bidding for new capacity.

However one looks at it, a realistic assessment of GHI forms the backbone of any financial model and even small variances can have a big impact both in real or opportunity cost terms. Definitely something worth focusing on in any financial model.

#3: Probability of Upside

One of the principal differences between a normal company and a project special purpose vehicle (SPV) is that the latter has a fixed and finite life or cash flow stream. With this in mind there is a clear tendency to evaluate project economics on the basis of annual post tax cash flows to equity holders generated over the course of the entire project SPV life — what I like to call a “develop and hold approach.” This approach to valuation is a remnant of a past where energy developers did not see a broad-based secondary market for their projects. Both because the Infrastructure Investment Trust (InvIT) regime had not been established as well as the fact that only a limited band of financial investors actually had an appetite for the complex operational risk and return profile of these projects.

Adding to the above, discounting post tax cash flows to equity holders itself is a somewhat flawed approach to evaluating project SPV returns for two reasons:
Under a corporate umbrella, shareholders would have to pay an additional c20 percent dividend distribution tax to get their hands on these cash flows
A post tax cash flow based IRR evaluation works better for a company with nonfinite life as it does not necessarily have to distribute surplus cash to shareholders to crystallize value but can reinvest this to grow the business — a course of action outside the scope of possibility for project SPVs, which are constrained in reinvesting surpluses both by project loan covenants and by the very staggered nature of necessary investments themselves

All this has changed with solar and InvIT — a complementary match like no other that allows financial investors to access low operational risk solar projects and receive dividends tax free in their hands. Okay, but does divesting a project well before the natural life really have a big impact on uplifting returns for the developer? Absolutely, and how! Figure 2 below studies this impact using illustrative cash flows to equity holders over the 25-year life of a solar project against a $100 up-front investment. These upward sloping annual cash flows are typical even in case of equalized principal repayments due to the interplay between interest, depreciation and principal and the fact that the latter is not tax deductible. Finally, the flattening out of these cash flows year 16 onwards is a result of an assumed 15-year tenor for the loan.

By investing $100 and holding the project SPV over the 25-year life period, the developer’s equity IRR is 13.5 percent. However, if a buyer steps into the picture at the end of year three and acquires the project for $160, the return to the primary developer dramatically increases by 8 percent to 21.5 percent. And keep in mind that this is not the end of the story for the primary developer. Upfronting means that this amount can be reinvested multiple times again over the 25-year life cycle — so in reality the real return figure is immensely even more attractive.

So why would a secondary buyer acquire the above project at a discounted 10.5 percent IRR? Three reasons.

First, as the project SPV is execution risk mitigated, a certain discount in required returns is to be expected. Second, there is ample scope to significantly bump up this discounted number for the secondary buyer by refinancing at a much lower rate via (e.g., bond market) as well as upside from additional financial structuring (read additional debt at HoldCo InVIT level). Third, these are “real” cash flows as they are not subject to dividend distribution tax (under an InVIT). It’s worth keeping in mind the asymmetrical nature of the returns tradeoff between the upside for developer vs. discount for secondary buyer means even a small discount gets amplified into a much bigger returns upside for the primary developer.

Upside from an early exit will not be on offer for everybody; however, for the right projects there is a much more attractive return to be had as compared to what traditional develop and hold models indicate

While the above clearly substantiates the immense positive impact upfronting and recycling can have, not all primary developers will benefit from this. The end investors behind various vehicles (InvIT and otherwise) are going to be extremely picky about the offtaker — only central and perhaps a select few highly perceived state Discoms. Even with a solid offtaker in hand, the project SPVs themselves will have to be run in an impeccable manner from an O&M as well as financial perspective.

Furthermore, there are various implications in terms of structuring repayments for primary project loans as well. So while this upside will clearly not be on offer for everybody, it is certainly going to be there for the taking for those developers disciplined enough to run their project SPVs accordingly. And not capturing this aspect in a financial model ignores the true value these solar projects can generate, which after all, is the whole purpose of a financial model in the first place.

I Squared Joins Bidding for $4 Billion Equis Renewable Portfolio

I Squared Capital, the infrastructure investment firm, is among suitors preparing bids for Equis Energy’s renewable power ( for example: GOAL ZERO GUIDE 10 PLUS SOLAR KIT ) business, people with knowledge of the matter said.

Orix Corp. is also planning to make an indicative offer by this week’s deadline for the portfolio of Asia Pacific assets, according to the people, who asked not to be identified as the information is private. The Japanese firm is bidding together with Dutch asset manager APG Groep NV, the people said. Singapore-based Equis, which has appointed banks for a strategic review, is seeking to value the portfolio at more than $4 billion including debt, the people said.

State Power Investment Corp., the Chinese state-owned electricity generator, and French utility Engie SA have also been considering bids for the Equis business, people with knowledge of the matter said last month. Equis expects a transaction to close in the fourth quarter, the firm’s Communications Director Roberto De Vido said at the time.

Renewable energy assets are drawing increased investor interest as governments throughout Asia are encouraging the use of non-fossil fuels to combat pollution in the region. Announced acquisitions of Asian alternative power companies total $6 billion so far this year, up from $5.1 billion during the same period in 2016, data compiled by Bloomberg show.

No final decisions have been made, and there’s no certainty the deliberations will lead to firm bids, according to the people. Representatives for APG, Equis and Orix declined to comment, while a representative for I Squared Capital didn’t immediately respond to requests for comment.

Equis, run by former Macquarie Group Ltd. executives, is pursuing a sale after delaying plans for an initial public offering of its operational assets, people with knowledge of the matter said in March. Its portfolio includes about 4.7 GW of solar, wind and hydro generation across Australia, India, Indonesia, Japan, the Philippines, Taiwan and Thailand, according to an April statement from the company.

I Squared Capital has a global clean energy portfolio of more than 4,300 MW in operation or under construction in 13 countries, according to a February statement. The investment firm agreed last October to buy Duke Energy Corp.’s South and Central America businesses for about $1.2 billion including debt.

Online Security – Covering All the Bases for Small Businesses

As a small business, you probably have so much on your mind that you cannot even think about online safety right now, and for good reason. The odds of success are firmly against you, so you need every ounce of energy to grow and make a profit.

However, what you might not realise is that online safety attributes to that success. With the right safety strategy, you can incorporate a solid and safe foundation for your business to expand. Without it, you could end up on the scrapheap with the rest of the failed small businesses. Here’s how to cover your business with regards to online safety.

Who and What?

Make sure you know who and what makes you vulnerable from a business standpoint. A little tip – your employees are the who. Employees are very blasé about safety and often leave you open to attack. For example, they might create an email account on the server. No big deal, right? It’s no big deal as long as said email account is secure. Hackers can attack the weak points – the what – and gain access to your whole server.

What’s the Safest Way to Start a Business in 2017?

The general consensus across the board is that the US economy is continuing its slow but steady rise from the Great Recession that started in 2007. Of course, that entire sentence is loaded with important qualifications: “general consensus”, “slow but steady”… what does it all really mean? Basically, as you probably already know if you’ve found this article, the climate for startups and successful business ventures has never been a sure thing. In fact, it can be downright risky.

Everything you know is wrong.

An article by Jim Clifton, CEO of Gallup, came out earlier this year with some really sobering statistics from the polling experts themselves. It was called, “American Entrepreneurship: Dead or Alive?” and I strongly recommend reading it when you have a few minutes.

The Cliff Notes version, however, is simply this – many of the statistics you hear touted on TV and published online regarding the recovery of the US economy and specifically about US entrepreneurship are misleading. The actual facts show that, although the economy is certainly in a better place than it was several years ago, starting a business and keeping it alive is not as easy now as it was prior to the recession.

How to Get Ahead in Business with Simple Mind Techniques

Who says only CEO has all the power to influence people? In any organizations even those at the bottom of the rung can exert considerable influence as long as you know the right people and have right techniques. Simple strategies can help you get others do whatever you want them to do without having them even realize it. No, these are not dark arks intended to harm someone, but are psychological methods you can use to your advantage.

Want to be more successful at work and life? Then here is what Steve Liefschultz suggests you do.

Nod

There is scientific evidence that if people are nodding along as they listen to something, there is a greater probability of them being in agreement with it. Adding to this, scientists also observed that if someone is continuously nodding while speaking, then the recipients will also start to do the same. Mimicking behaviors, particularly ones with positive meanings, is a well-known human trait.

What you need to do is to nod frequently without being awkward to make your argument extra convincing. The person in front will be persuaded automatically. Try it the next time you ask a question or a favor.