Tag Archives: Amazon

Supplier Report: 2/23/2018

Tesla and other battery-based companies are consuming so much cobalt that Apple is considering stockpiling it.  The company wants to hedge against future price increases.  Apple can use all that new Warren Buffett money to help pay for that stockpile (he shifted more money away from IBM and over to Apple).

Telsa also made news this week due to their AWS account being hacked and set up to mine for bitcoin (you can’t make this up).

Back in August, I dedicated a few podcasts on Google’s anti-competition loss in Europe. Bloomberg revisited the story to figure out who benefited from the ruling… as I mentioned in the podcast in August, it wasn’t small businesses.

Artificial Intelligence

  • If you don’t like what IBM is pitching, blame Watson: It’s generating sales ‘solutions’ now

    Internal documents seen by The Register reveal the tech goliath has developed something it calls “cognitive solutioning,” to be deployed when Big Blue is asked to do a job that can’t easily be scoped from its service catalogue.

    “We’ve trained Watson on our standard solutions and offerings, plus all the prior solutions IBM has designed for large enterprises,” the corporate files state. “This means we can review a client’s RFP [request for proposal] and come up with a new proposed architecture and technical solution design for a state of the art system that can run enterprise businesses at scale.” Proposed solutions will be delivered “in minutes,” it is claimed.


  • IBM’s Watson Project Suffers Backlash from Overhype

    The IBM Watson project is one example of an AI project that was over-hyped, a project that has tried to tackle too much too soon. IBM had early successes with AI. It’s Deep Blue and Watson technologies proved to be superior to humans in competitions like chess and the game show Jeopardy. IBM then announced that they were re-positioning Watson from a novelty to an AI project with the target of improving cancer care. Despite a big budget and significant positive press for the project, a recent analysis of the results from the Watson cancer project are underwhelming.

    The investigation was made by STAT and found that “Perhaps the most stunning overreach is in the company’s claim that Watson for Oncology, through artificial intelligence, can sift through reams of data to generate new insights and identify, as an IBM sales rep put it, ‘even new approaches’ to cancer care… While Watson became a household name by winning the TV game show ‘Jeopardy!’, its programming is akin to a different game-playing machine: the Mechanical Turk, a chess-playing robot of the 1700s, which dazzled audiences but hid a secret — a human operator shielded inside. In the case of Watson for Oncology, those human operators are a couple dozen physicians at a single, though highly respected, U.S. hospital: Memorial Sloan Kettering Cancer Center in New York. Doctors there are empowered to input their own recommendations into Watson, even when the evidence supporting those recommendations is thin.”



  • Tesla’s Amazon cloud account was hacked and used to mine cryptocurrency

    Tesla’s Amazon Web Services account was hacked to mine cryptocurrency, Fortune first reported. The hack, which was brought to Tesla’s attention by the cybersecurity startup RedLock, also reportedly exposed some of Tesla’s proprietary data related to mapping, telemetry, and vehicle servicing.

    RedLock discovered the hack after it found an IT administrative console that didn’t have a password, but the company was unable to determine who initiated the hack or how much cryptocurrency was mined. According to Fortune, Tesla paid RedLock over $3,000 as part of its bug bounty program, which rewards people who find vulnerabilities in the company’s products or services that could be exploited by hackers.



  • Cisco Switches Back On

    A major refresh of its switching products last summer helped lift the company’s overall revenue by nearly 3% year over year to $11.9 billion for the period ended Jan. 27. That was Cisco’s first quarter of growth after eight straight periods of declines. The applications and security segments each grew revenue by about 6% year over year.

    Those results, along with a better-than-expected forecast, were good enough to boost Cisco’s share price by 6% in after-hours trading. Investors also are enthusiastic about the company’s cash hoard of $34 billion, net of debt, that could fuel future deals thanks to the recent tax overhaul. Cisco still has plenty of diversification ahead of it, but a revived core businesses should make the process less painful.


  • IBM vs Google vs Intel – The race to quantum computing

    “Using… classical computers, it will take 3,000 years,” she says about a famous and burdensome encryption problem. To tackle the same problem, a quantum computer “could solve it in minutes.”

    She lists the myriad of other applications quantum computers could optimise, such as complex physical modelling for climate, economics, and engineering fields, advanced chemical and material simulations, machine learning, and database searching.

    “As a consequence,” she concludes, “there’s a massive international race to build a quantum computer.”


  • Apple is trying to lock down battery components before electric carmakers get them

    Apple is in talks to buy cobalt directly from miners to help shield it from any shortages sparked by the boom in electric cars, according to a report from Bloomberg. Cobalt is a key mineral used in lithium-ion batteries, and Bloomberg says that Apple is looking to secure contracts for several thousand metric tons of cobalt each year for five years or longer. Its first discussions for deals took place a year ago, but another source told Bloomberg that Apple might not even go ahead with the plans.

    If Apple does end up buying cobalt directly, it will be in competition with car manufacturers and battery makers in locking up supplies of the raw material. Car giants like BMW and Volkswagen are also searching for multiyear deals to ensure they also have enough cobalt to meet targets in electric car production. Bloomberg reports that smartphone batteries use around eight grams of refined cobalt, but a battery for an electric car needs more than a thousand times that amount.



  • Amazon’s Latest Ambition: To Be a Major Hospital Supplier

    The market for medical supplies is one of a growing number of businesses the online retail giant has set in its sights, from groceries to clothing, often with market-moving results. Health-care distributor shares dropped Tuesday, in part from The Wall Street Journal’s report of Amazon’s intensified push into the industry, analysts said.

    Amazon recently dispatched employees to a large Midwestern hospital system, where officials are testing whether they can use Amazon Business to order health supplies for the system’s roughly 150 outpatient facilities, according to a hospital official overseeing the efforts.


  • Warren Buffett doubles down on Apple, dumps nearly all of his IBM shares

    Buffett’s investment firm, Berkshire Hathaway, ended the year with 165.33 million Apple shares, collectively worth some $27.6 billion based on yesterday’s closing price. Berkshire Hathaway is now Apple’s fourth-largest institutional investor. The firm began buying Apple stock in early 2016.

    Meanwhile, Berkshire Hathaway sold off around 35 million shares of IBM in the fourth quarter, and entered 2018 with just 2.05 million shares. The firm began buying up IBM stock in 2011, and at one point held more than 80 million shares.


  • Why Europe’s Google Rulings Don’t Benefit Consumers

    Reporters for Politico have discovered that FairSearch, the non-profit group that filed the Android complaint in 2013, is under the full legal control of two giant companies: U.S.-based Oracle and South Africa-based Naspers, which owns shares in China’s Tencent and Russia’s Mail.ru. At the time the complaint was filed, Microsoft was also part of the effort, but it left FairSearch in 2015. Other companies that have been mentioned as FairSearch members are so-called adherent members without voting rights who “do not participate actively in the achievement of the association’s goals.”

    This makes sense on a certain level: The small firms don’t have the deep pockets to hire expensive lawyers and PR consultants (FairSearch is working with elite firms Clifford Chance and Burson Marsteller). FairSearch has rejected Politico’s findings as immaterial, and some of its “adherent members” have backed this stance. But the implication is clear: If, at the end, it all comes down to Oracle’s and Naspers’s desire to keep Google in check, Google may end up punished but consumers and smaller companies won’t get much out of it.


Photo:Maria Badasian

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Supplier Report: 2/9/2018

Companies love to say AI is the future, but some are spending more money on that future than others.

Amazon is going deep on AI within various aspects of their business.  A recent Wired article highlights the projects Amazon is building automation and robotics strategies (managing internal process, mining customer data, and selling automated services in the cloud and via smart speakers). These practices are paying off as Amazon reported their largest profit ever.

Amazon isn’t alone, Foxconn is allocating $340M in automation R&D and IBM keeps advancing Watson’s medical abilities recently developing a method to diagnose certain types of mental illness.


  • LogMeIn is buying Jive Communications for up to $357M to step up in enterprise unified comms

    Yet more consolidation in the enterprise collaboration software market. Today LogMeIn, the company that offers conferencing services like GoToMeeting and join.me as well as authentication and other online services to businesses and others, announced that it would acquire Jive Communications for $342 million in cash plus up to $15 million based on reaching specific milestones in the next two years.

    Jive Communications is not to be confused with Jive Software, the Slack competitor in enterprise collaboration that itself was acquired last year for $462 million by Aurea. However, it is also in a bigger area of enterprise communications, and underscores how we are continuing to see a lot of M&A and general growth in that market. This is a strong exit for Jive Communications, a Utah-based startup that had raised only around $31 million since it was founded in 2006.


  • Qualcomm rejects Broadcom’s $121 billion bid

    Qualcomm’s board of directors issued a statement on Thursday saying that they are turning down Broadcom’s $121 billion bid to buy the competing chipmaker.

    According to the release, Qualcomm “unanimously rejected” an “unsolicited proposal” to buy all of its shares at $82 each, of which $60 would be cash and $22 stock. Broadcom made the revised offer on Monday, up from the previously proposed deal price of $70 per share.


Artificial Intelligence

  • IBM’s New AI Can Predict Psychosis in Your Speech

    The group built on the findings of a 2015 IBM study demonstrating the possibility of using AI to model the differences in speech patterns of high-risk patients who later developed psychosis and those who did not. Specifically, they quantified the concepts of “poverty of speech” and “flight of ideas” as syntactic complexity and semantic coherence, respectively, using an AI method called Natural Language Processing (NLP).

    Their AI then evaluated the speech patterns of patients that researchers instructed to talk about themselves for an hour.


  • Foxconn to plug at least $340M into AI R&D over five years

    According to Nikkei, Foxconn intends to recruit up to 100 top AI experts globally. It also said it will recruit thousands of less experienced developers to work on building applications that use machine learning and deep learning technologies.

    Embedding sensors into production line equipment to capture data to feed AI-fueled automation development is a key part of the AI R&D plan, with Foxconn saying earlier that it wants to offer advanced manufacturing experiences and services — eyeing competing with the likes of General Electric and Cisco.

    The company has also been working with Andrew Ng’s new AI startup Landing.ai — which is itself focused on plugging AI into industries that haven’t yet tapping into the tech’s transformative benefits, with a first focus on manufacturing — since July.

    Mentioned this last week, here are some more details.

  • Inside Amazon’s Artificial Intelligence Flywheel

    Amazon loves to use the word flywheel to describe how various parts of its massive business work as a single perpetual motion machine. It now has a powerful AI flywheel, where machine-learning innovations in one part of the company fuel the efforts of other teams, who in turn can build products or offer services to affect other groups, or even the company at large. Offering its machine-learning platforms to outsiders as a paid service makes the effort itself profitable—and in certain cases scoops up yet more data to level up the technology even more.

    It took a lot of six-pagers to transform Amazon from a deep-learning wannabe into a formidable power. The results of this transformation can be seen throughout the company—including in a recommendations system that now runs on a totally new machine-learning infrastructure. Amazon is smarter in suggesting what you should read next, what items you should add to your shopping list, and what movie you might want to watch tonight. And this year Thirumalai started a new job, heading Amazon search, where he intends to use deep learning in every aspect of the service.

    “If you asked me seven or eight years ago how big a force Amazon was in AI, I would have said, ‘They aren’t,’” says Pedro Domingos, a top computer science professor at the University of Washington. “But they have really come on aggressively. Now they are becoming a force.”


  • Is artificial intelligence killing Japan’s banks? (Thanks JD!)

    Due to Japan’s zero interest rate policy, domestic banks can’t make money on loans, so they’ve become clearinghouses for other financial companies’ products, be it mutual funds or insurance policies. Banks are basically salesmen who collect handling fees for delivering products and services. Once that task is automated or otherwise rendered obsolete by new technology, what’s the point of a bank?



  • Is Google Losing to Amazon?

    But profitability isn’t why investors favor the retailer over the search engine. Google’s $26.1 billion of operating income last year is about 40% more than Amazon has earned in its entire existence. Nor is it the propensity to make big gambles. The difference is that Amazon has figured out how to make more of its big gambles, such as Prime and its AWS cloud service, drive its accelerating growth. Since 2010, Amazon’s larger revenue base has averaged 28% growth annually while Alphabet’s has averaged 21%.


  • Amazon Reports Largest Profit Ever

    Amazon’s sales rose 38 percent to $60.5 billion in the quarter, also beating estimates. Its North America revenue jumped 42 percent to $37 billion, while international sales grew 29 percent to $18 billion. Revenue from subscription fees grew 49 percent to $3.2 billion. Advertising and other revenue rose 62 percent to $1.74 billion.

    Amazon Web Services (AWS) continued to be the fastest-growing and most profitable business of the company. The unit posted a 45 percent rise in sales, jumping to $5.1 billion, and saw its profit margin expand from the third quarter. AWS sales accounted for a whopping 64 percent share of Amazon’s total operating income.



  • Crucial iPhone source code posted in unprecedented leak

    Critical, top secret Apple code for the iPhone’s operating system was posted on Github, opening a new, dangerous avenue for hackers and jailbreakers to access the device, Motherboard reported. The code, known as “iBoot,” has since been pulled, but Apple may have confirmed it was the real deal when it issued a DMCA takedown to Github, as Twitter user @supersat noted.

    iBoot is the iOS code that ensures a secure boot by loading and checking that kernel is properly signed by Apple before running the OS. The version that was posted to Github, supposedly by a Twitter user named @q3hardcore, was for iOS 9, but much of it likely still exists in the latest version, iOS 11.



  • Oracle’s cloud bravado masks its database despair

    No, we’re not going to see Oracle’s database revenue fall off a cliff. But that might not be because its customers remain committed to the database leader. Instead, they may simply continue to pay for stuff they don’t actually use. As a recent Rimini Street survey showed, as much as 74 percent of Oracle customers are running unsupported, with half of Oracle’s customers not sure what they’re paying for. These customers are likely paying full-fat maintenance fees for no-fat support (meaning they get no updates, fixes, or security alerts for that money).


  • Where Barry Padgett Plans to Lead Ariba

    The number one lesson by far is that you need to go in with the right drivers. The wrong driver is, “I have a bunch of data. How do I make money on the data?” There are a lot of examples where platforms have come out of the desire to monetize a resource or an asset that you already have, and that is a terrible model — number one, because you end up building the wrong set of services, and, number two, in general, you find over time that people aren’t really willing to pay for it. So you end up doing a bunch of pivots to figure out what your platform story really should be.

    When you go into platform transformation, you really need to do it from the lens of the customer. You have to think about “How does the customer get value out what they’ve already bought from you?” rather than, “How do I charge the customer more, or how do I take what the customer’s generating and create more opportunity for myself financially?” When you really think about it from a customer value perspective, you build out the right set of services in the right way.


  • Microsoft is reportedly shifting its Windows strategy as it tries to outmaneuver Apple and Google

    Thurott reports that Microsoft will no longer offer Windows 10 S as a standalone operating system. You could never buy it yourself, but computer manufacturers (OEMs, or “original equipment manufacturers” in industry parlance) could license it from Microsoft to pre-install on the computers they sold to customers.

    Instead, Microsoft will push a so-called S Mode onto all versions of the Windows 10 operating system, reports Thurott. When enabled, S Mode will make any version of Windows 10 act like Windows 10 S, with all of the benefits and tradeoffs therein.

    Microsoft had previously said that S Mode would be coming to Windows 10 for businesses in future updates; this would just bring it to all of the consumer versions, too.



  • Why Mainframes Aren’t Going Away Any Time Soon

    The focus on Linux isn’t the only motivator behind the upsurge in mainframe use in data centers. Increasingly, enterprises with heavy IT needs are finding many advantages to incorporating modern mainframes into their plans. For example, mainframes can greatly reduce power, cooling, and floor space costs. In markets like New York City, where real estate is at a premium, electricity rates are high, and electricity use is highly taxed to reduce demand, these are significant advantages.

    “There was one customer where we were able to do a consolidation of 25 x86 cores to one core on a mainframe,” Santalucia said. “They have several thousand machines that are ten and twenty cores each. So, as far as the eye could see in this data center, [x86 server workloads] could be picked up and moved onto this box that is about the size of a sub-zero refrigerator in your kitchen.”



  • Akamai has laid off 400 workers or 5 percent of global workforce

    Akamai, the Cambridge Massachusetts content delivery network and network services provider, announced they had laid off 400 people in their earnings call with analysts yesterday.

    On the call, Akamai CEO Tom Leighton indicated that the 400 people represented 5 percent of the company’s 8000 worldwide workforce. “As part of our effort to improve operational efficiency, we reduced headcounts in targeted areas of the business, most notably in areas tied to our Media business. Overall, we have removed about 400 positions or 5% of our global workforce,” Leighton told analysts.

    He went onto to say that the layoffs actually began at the end of last year and have spilled over into this week. The company sees this as part of an effort to get leaner and cut costs, an effort that predates Elliott Management buying a 6.5 percent stake in the company in December.


  • Best Buy will stop selling CDs as digital music revenue continues to grow

    Despite no longer selling CDs, Best Buy will still sell vinyl for the next two years, which Billboard says is part of a commitment it made to vendors. Sources suggested that Best Buy’s music CD arm was only generating $40 million annually.

    As we’ve previously reported, during the first half of 2017, streaming services accounted for 62 percent of revenue from the US music market. The decline of CD sales has also sparked Warner Music Group to offer voluntary buyouts to its 130 staff working in physical product, according to Billboard.

    It’s not surprising that we’re no longer buying CDs — at least not for new music. The best-selling CD in 2016 was a Mozart boxset, which contained 200 CDs that were individually counted as a separate sale. Users who don’t buy music prefer to stream it via services like Spotify and Apple Music, and gadget makers aren’t really making CD players anymore.


Photo: Adam Fossier

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Supplier Report: 2/3/2018

Amazon continues to eat the world.  The news of the company officially creating a private healthcare consortium with JPM and Berkshire has sent investors scrambling.  With few details, the world has to wait to fully understand the impact.

Add Cisco to the list of companies that knew about a major security flaw for months and didn’t tell customers.  The bug impacts the company’s adaptive security appliance (ASA) and scored a 10 out of 10 on the Common Vulnerability Scoring System.

Is VMWare going to buy Dell so the company can go public again and pay down debt? Maybe?


  • VMware May Buy Dell in Biggest-Ever Tech Deal

    Why would Dell, which already owns 80 percent of VMware, sell itself back to the smaller company? There are a few compelling reasons.

    The reverse merger would allow Dell to once again become a public company without having to undergo a fresh initial public offering (IPO). The company went private in 2013 in a $24.4 billion deal that gave ownership control to founder Michael Dell and private equity firm Silver Lake Partners. Dell is reportedly carrying around $50 billion in debt, but going public through VMware would allow Dell and Silver Lake to sell back some of their shares publicly, both to offset the debt and to cash in themselves.


  • SAP to acquire CallidusCloud, beefs out CX and LMS offerings

    The deal, reported to be worth $2.4bn and funded from an unspecified mix of cash and acquisition term loan is expected to complete in Q2 FY2018 following the usual regulatory song and dance. The deal is a 21% premium on CallidusCloud 30-day weighted volume.

    The press release on the acquisition focuses upon CallidusCloud’s sales performance management (SPM) solutions that Gartner rates as the leader in that segment. CallidusCloud also appears in the leaders’ segment for the configure, price, quote (CPQ) market as assessed by Forrester. The acquisition, which will be folded into SAP’s hybris solution, positions SAP ahead of arch-rival Oracle.


  • Fujifilm acquires Xerox for $6.1 billion

    “The new Fuji Xerox will be better positioned to compete in today’s environment with truly global scale, increased presence in fast-growing markets, and innovation capabilities to effectively meet our customers’ rapidly-evolving demands.”

    Beyond photocopying, Xerox is probably best known in the tech world for failing to capitalize on a number of 1970s-era inventions that eventually became standard on modern personal computers. Ethernet, the mouse, the laser printer, and many other protocols and technologies were created at its Palo Alto Research Center (PARC) for the first time.

    As part of the deal, $2.5 billion will be returned to shareholders while 10,000 jobs in Asia will be cut.


  • Red Hat to Acquire CoreOS, Expanding its Kubernetes and Containers Leadership

    Red Hat, Inc. (NYSE: RHT), the world’s leading provider of open source solutions, today announced that it has signed a definitive agreement to acquire CoreOS, Inc., an innovator and leader in Kubernetes and container-native solutions, for a purchase price of $250 million, subject to certain adjustments at closing that are not expected to be material. Red Hat’s acquisition of CoreOS will further its vision of enabling customers to build any application and deploy them in any environment with the flexibility afforded by open source. By combining CoreOS’s complementary capabilities with Red Hat’s already broad Kubernetes and container-based portfolio, including Red Hat OpenShift, Red Hat aims to further accelerate adoption and development of the industry’s leading hybrid cloud platform for modern application workloads.


Artificial Intelligence

  • iPhone assembler Foxconn pledges $340m for AI venture

    “We will at least invest some 10 billion New Taiwan dollars ($342 million) over five years to recruit top talent and deploy artificial intelligence applications in all the manufacturing sites,” said Chairman Terry Gou.

    “It’s likely that we could even pour in some $10 billion or more if we find the deployments are very successful or can really generate results,” said Gou.

    Gou added that his company aimed to recruit up to 100 top AI experts globally and would open up thousands of jobs for young talent should they have good ideas on how to develop applications using machine learning and deep learning techniques.


  • Google credits AI for stopping more rogue Android apps in 2017

    It credits Google Play Protect for one of the biggest improvements: its ability to spot extremely harmful apps that commit fraud, steal info or allow hijacks. While there weren’t many of them, the mechanism reduced the number of installations by an “order of magnitude” over 2016, Google said. It added that it took down over 250,000 copycat apps (those trying to piggyback off the success of popular apps) and “tens of thousands” of apps violating policies against apps that feature hate speech, illegal acts and porn.

    Google is fully aware that its system isn’t foolproof, and that some apps will still slip through the cracks. The improvements do make a better case for sticking to Google Play for app downloads when you can, though.



  • Oracle CEO Urges Enterprises to Ditch Data Centers and Move to Cloud

    “CEOs and CFOs have to get out of the data center business. The $200 billion system integrator industry is non-sustainable,” said Hurd.

    With the Oracle Cloud and other cloud systems, customers don’t update their systems, the updates come to them automatically. The same is true for the latest security updates and patches keeping systems more current at a cost that Hurd said will always be much cheaper than maintaining your own data center.

    “The likelihood you’re more secure than if you used an enterprise cloud provider is zero,” said Hurd. “Oracle Cloud will be more secure than any individual customer could hope to be.”

    I am sure people will move… but will they move to Oracle Cloud?

  • Google’s G Suite is no Microsoft killer, but still winning converts

    G Suite may never be an Office killer. Just 15 companies listed in the S&P 500 currently have Google’s business tools, according to a review of public email server data by Reuters. Its $1.3 billion in G Suite sales ranked a distant No. 2 behind Office’s $13.8 billion, according to 2016 data from Gartner.

    But Mann and other analysts say that second place is not a bad spot. Smartphones and artificial intelligence have opened up new opportunities for Google to get on the radar of corporate IT departments even if it never tops Microsoft, they said. A robust G Suite is a cornerstone of Google’s efforts to diversify revenue, which overwhelmingly comes from online ad sales.

    At a minimum, Google is loosening loyalty to Microsoft at a time when the Redmond, Washington-based giant also faces competition from startups such as chat service Slack that offer specialized online business tools. Google’s low-cost, subscription-based G Suite has also pushed Microsoft to adopt a similar strategy with Office 365, an online version of its popular software.



  • If your businesses uses a Cisco VPN, patch it now to avoid critical flaw

    Cisco is urging users of its Cisco Adaptive Security Appliance to patch their systems to protect against a critical VPN vulnerability. Addressed in a security advisory, Cisco noted that the flaw received a Common Vulnerability Scoring System (CVSS) score of 10 out of 10—the highest possible rating.

    The vulnerability specifically affects devices running the vulnerable version of the appliance software that also have the webvpn feature enabled, the advisory said. In this instance webvpn must be configured globally, but must also “be one enabled interface via the enable in the configuration,” the advisory said. To determine if that is the case in your organization, an admin must “use the show running-config webvpn command at the CLI and verify that the command returns at least one enable line,” the advisory said.

    Cisco ‘waited 80 days’ before revealing it had been patching its critical VPN flaw

    Cisco’s advisory also included a table showing which versions of ASA were affected and the first release that had a fix. It was not immediately clear from Cisco’s table when it released the first fixed version.

    However, Colin Edwards, a system administrator, filled in the blanks in his own table with the release date for fixed versions of ASA, which shows Cisco actually rolled-out its first fixed version way back on November 10.

    As Edwards points out, Cisco decided to fix a super-critical bug in some products but then waited 80 days before it told sysadmins they needed to update now.


Data Center/Hardware

  • Samsung topples Intel to become the world’s largest chipmaker

    The Korean tech giant’s chipset division — which has long been its biggest hitter — grossed total revenue of $69 billion in 2017, eclipsing the $62.8 billion Intel reported for last year. That was a record year for Intel — and an annual increase of six percent — but it wasn’t enough to stop Samsung from knocking it from the top spot, which Bloomberg reports it had occupied since 1992.

    The writing was on the wall last year when Samsung beat Intel on a quarterly basis, but now it has held out for an annual win.

    The change of position highlights Samsung’s focus on mobile, and in particular memory chips which are an essential part of smartphones. Intel’s chips may be in 90 percent of the world’s computers, but it missed the mobile boom and is playing catch-up.


  • Lenovo to miss mobile turnaround target, posts third quarter net loss

    The segment, accounting for over 70 percent of Lenovo’s top line, saw an 8 percent rise in revenue over the period, despite a 0.2 percentage point year-on-year drop in market share, thanks to premium products such as datachables.

    Lenovo’s overall revenue for the October-December period came in at a three-year high of $12.94 billion, up slightly from $12.17 billion a year ago.

    Its bottom line for the period, however, swung to a loss of $289 million, versus a $98 million profit a year ago, dented by the one-off charge of $400 million linked to a reassessment of U.S. deferred tax assets.

    Lenovo reiterated that the short-term business outlook was challenging, but said in the longer term U.S. corporate tax cuts would “positively impact” earnings of its operations.



  • How Amazon, JPM and Berkshire could disrupt healthcare (or not)

    “At 1.1 million employees and growing, they are already a decent sized ‘health plan’ in themselves and could essentially operate as its own payer entity or possibly an ‘Accountable Care Organization’ for their employees,” Bhagat said in an email.

    “At a minimum it gives the companies more power to hold existing payer vendors more accountable for health and cost outcomes for their employees. It gives them a chance to deliver better healthcare and reduced costs and change the market dynamics in the commercial healthcare space.”

    All three firms also have tens of millions of customers, who could conceivably become among those eventually privy to their new dynamics.

    The healthcare industry isn’t holding its breath:

    “Walmart pioneered this with their $4 generic drugs,” Spencer Millerberg, CEO at marketplace analytics firm One Click Retail, said in an email. “But they stopped short by not completely addressing issues the government and private businesses couldn’t solve. Where Walmart left off, Amazon is picking up.”

    To be fair, Walmart’s effort has been stymied by realities, something that Amazon has yet to confront. In practice, its healthcare delivery was cumbersome and unprofitable, according to John Sarich, vice president of strategy at VUE Software, a firm that specializes in innovating and automating business processes for the insurance industry. Those are two things that are against the retail giant’s core nature. “Walmart took a run at being a Medicare Advantage vendor as well as selling Part D (pharmacy),” Sarich said. “What started out as a way to make money ended up with tying people up in explaining plans and benefits with very little revenue coming into Walmart. It was never a moneymaker for Walmart.”

    CVS, other health stocks down upon Amazon, JPMorgan, Berkshire healthcare co news

    However, CVS, UnitedHealth and others were down after the news came out, indicating investors’ displeasure at the announcement. CVS dropped by just over 4 percent by midday, UnitedHealth plunged a whopping 11.5 percent, Express Scripts was off by 3.6 percent, Cigna was down by just under 7 percent and Walgreens fell by 2.6 percent.

    The plunge isn’t a surprise considering the deal may affect these companies in various ways. Amazon has made indications it would be moving into drug delivery, affecting CVS, Walgreens and Express Scripts’ models.

    The announcement also possibly affects health insurance providers like UnitedHealth and Cigna, as well. The three companies collectively employ 880,000 people and the plan is to cover all U.S. employees, though it’s not clear how many of the 880,000 are working internationally versus in the States.


  • Amazon’s ad business grew 60 percent this quarter

    In its fourth-quarter earnings today, Amazon reported that “other” revenue, which mostly means advertising, plus its co-branded credit card agreements, increased to $1.7 billion in the fourth quarter. That’s 60 percent growth year over year.

    In the third quarter, “other” revenue grew 58 percent year over year to $1.12 billion.

    “Advertising was a key contributor [to strong growth],” director of investor relations Dave Fildes said on the earnings call. “We continue to make the offering more valuable. We’re focused on finding ways to work with those companies – vendors or sellers — coming to us and offer them a great experience on the website and ability to reach customers.”

    The company hinted more was to come in terms of building out the platform. CFO Brian Olsavsky said that Amazon has found itself as a “key lean-in from brands and agencies into the e-commerce marketing space,” which has helped bolster that growth.


  • There’s no way the government is building its own 5G network

    there’s just no way that the U.S. government, even at its best and most efficient, and if it started bipartisan work on this tomorrow, could be in any way competitive in the timing and scale of such a deployment. It takes billions of dollars and years of work to lay the foundation for something like this, and others have a huge head start. And let us not forget that we are experiencing one of an endless series of budget crises, which would not be alleviated by the proposal of this kind of massive undertaking.


Photo: Patrick Hendry

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Supplier Report: 1/26/2018

Amazon is beefing up their security offerings via the acquisition of security startup Sqrrl. As Amazon makes their services more secure, is Google losing their mojo?

A former Google employee certainly thinks so – calling the company “arrogant” and “conservative”.  This former employee has made headlines in the past for criticizing the “Google Plus” social site while still employed at Google… well he is at least 1 for 2.  

Another company is getting called out (but by a much more respected member of the tech community)… Linus Torvalds continues to publicly trash Intel’s patching efforts for Meltdown and Spectre.  It makes you wonder what is going on over at Intel.


  • AWS beefs up threat detection with Sqrrl acquisition

    AWS has purchased Sqrrl, a Cambridge, Mass. security startup with roots in the NSA. The company helps analyze a variety of sources to track and understand security threats quickly using machine learning.

    The announcement appeared on the Sqrrl home page in note from company CEO Mark Terenzoni. “We’re thrilled to share that Sqrrl has been acquired by Amazon. We will be joining the Amazon Web Services family, and we’re looking forward to working together on customer offerings for the future,” he wrote.

    The question in these types of purchases is what happens to the customers. The statement suggested that at least for the time being, Sqrrl will continue to work with its existing customers.

    According to a 2016 Computerworld review, the solution collects data from a variety of sources and presents threat findings in a dashboard for security analysts, who can view a visual representation of any potential vulnerabilities.


  • Ford Scoops Up Software Firms as It Drives Toward the Driverless

    Ford Motor Co. is acquiring two small software firms to help build out its mobility business, a move that highlights the need for auto companies to seed their management teams with technology talent to keep pace in a fast-changing transportation sector.

    Ford said Thursday it is buying Autonomic Inc., a Palo Alto, Calif., startup with 70 employees that is developing a software backbone for Ford to provide urban transit services to consumers and businesses. Ford said the firm’s CEO, Sunny Madra, will lead a new team inside Ford that will come up with ideas for new transit options.

    The nation’s No. 2 auto maker by sales also said it would acquire TransLoc, a North Carolina firm that makes software to help transportation operators optimize drive routes. Ford didn’t disclose terms of either transaction.


Artificial Intelligence

  • AI will turn the workforce into hyper productive business centaurs

    Aficionados of centaur chess argue that the pairing of man and machine takes the game to never-before-seen levels of perfection, with blunder-free games, perfect tactical play and the flawless execution of strategic plans.

    Over the last 20 years, these AI systems have evolved drastically; just last month, a new program called AlphaZero is the new reigning chess champion thanks to its moves that are “unthinkable” to a human player. But the centaur chess model of human/computer collaboration has grown more relevant to the entire world of work — as AI technology moves from the lab to the business world, an entire workforce of centaurs becomes possible, enabling previously unimagined levels of productivity and performance.


  • The state of AI in marketing in 5 charts

    According to a Salesforce study from July, about half of the 3,500 marketing leaders surveyed are already using AI, and more than a quarter of these leaders are planning to pilot AI programs in the next two years.

    Using AI for media buying is one of the strongest use cases for AI. Marketers believe AI can improve targeting and personalization when it comes to media placements. According to Salesforce’s report, 60 percent of marketers believe AI will have a “substantial or transformational” impact on their business’ programmatic and media buying in the next five years.


  • Facebook Names Former IBM Watson Executive as Head of AI Group

    The hiring of Pesenti, who has a more managerial background, may indicate that Facebook is looking to step up the application of its artificial intelligence research in its business, rather than just focusing on the academic exploration of the science. Facebook is trying to rely more on AI to help it spot and remove photos and videos that violate its policies, for example, instead of waiting for users to flag troublesome content. A Facebook spokesman said LeCun will still “set the scientific agenda for the group.”



  • Why Barcelona’s anti-Microsoft move to open source could be a disaster

    While I’ve been on the record in favor of such technological sovereignty in the past, with the caveat that preferences for open source trump mandates, the reality of such moves comes at a steep price. The City of Munich is now spending €50 million to undo its long flirtation with Linux desktops. Why? “Users were unhappy and software essential for the public sector is mostly only available for Windows,” Munich councilor Anne Hübner detailed. The city initially spent 15 years (and millions of euros) trying to get away from Microsoft, but “those efforts eventually failed.”

    Again, why? Because they put ideology before the practical needs of real people. Even at open source company Red Hat it’s now common to see plenty of Macs and iPhones, both proprietary in ways Microsoft Windows never approached. It turns out that true “freedom” comes when people can do their jobs, not when they’re shackled to some grand ideology.



  • Linus Torvalds declares Intel fix for Meltdown/Spectre ‘COMPLETE AND UTTER GARBAGE’

    These and other kind epithets are awarded by Torvalds in a public email chain between him and David Woodhouse, an engineer at Amazon in the U.K., regarding Intel’s solution as relating to the Linux kernel. The issue is (as far as I can tell as someone far out of their depth) a clumsy and, Torvalds argues, “insane” implementation of a fix that essentially does nothing while also doing a bunch of unnecessary things.

    The fix needs to address Meltdown (which primarily affects Intel chips), but instead of just doing so across the board, it makes the whole fix something the user or administrator has to opt into at boot. Why even ask, if this is such a huge vulnerability? And why do it at such a low level when future CPUs will supposedly not require it, at which point the choice would be at best unnecessary and at worst misleading or lead to performance issues?



  • Yes, cities should indeed fight for tech jobs

    What all these critics are missing though is that the economy has changed dramatically over the past thirty years. Everyone is competing for better jobs and better income, be they workers and citizens or cities, states, and even national governments. China is competing ferociously to bring back AI talent to its mainland from the United States in just the same way that Illinois is trying to get Amazon to set up shop through a payroll tax recapture strategy.

    Here’s what I see with the Amazon process: 238 cities across North America, in just a few weeks, managed to each put together their own proposals on what they would offer to bring the company to their area. Boston has taken decades to extend the green line to Somerville, but managed to put together a second-phase winning proposal for Somerville in just a matter of weeks.


  • New study predicts Atlanta has best shot at becoming Amazon’s HQ2

    However, the firm is betting on Atlanta as the top pick for a variety of reasons.

    It’s still close enough to DC, Boston and New York, but Atlanta has more available space to offer, and is affordable. If Amazon were to choose this southern city, it could build on the outskirts of town to avoid crowding, overpricing and congestion.


  • IBM’s Growth Comes at a Cost

    Still, IBM’s shares fell Friday, much like they have done following 10 of its last 12 quarterly reports. A bit of growth, as it turns out, isn’t quite enough to assuage concerns about how the company gets there. Fourth-quarter gross margins slipped below the 50% line for the first time in five years for what is typically the company’s strongest seasonal period. And, while IBM did project annual revenue growth for 2018, it is unclear if the company can do that without continued help from favorable exchange rates.


  • Google is ‘arrogant’, ‘conservative’, ‘can no longer innovate’, says Googler of 13 years as he quits

    “The main reason I left Google is that they can no longer innovate. They’ve pretty much lost that ability. […] First, they’re conservative. […] They are so focused on protecting what they’ve got, that they fear risk-taking and real innovation. Second, they are mired in politics. […] Third, Google is arrogant. Google has the arrogance of the “we”, not the “I”. When a company is as dramatically successful as Google has been, the organization can become afflicted with a sense of invincibility and almost manifest destiny, which leads to tragic outcomes: complacency, not-invented-here syndrome, loss of touch with customers, poor strategic decision-making, ” Yegge shared in a blog post on Medium.


Photo: Joey Kyber

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SourceCast: Episode 104: YouTube Edition

Amazon is pushing into more business areas such as produce, physical retail, and maybe even pharmaceuticals. When Amazon eats the world, what does that mean for everyone living there?

Photo: Roberto Nickson

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