Supplier Report: 9/29/2017
It was a very unstable week…
Equifax’s CEO is stepping down, Google is implementing organizational and policy changes in the wake of the EU ruling, HPE is cutting another 5,000 jobs, and we found out that Alexa is not HIPAA compliant… oh and IBM bought another Israeli company.
Acquisitions
- Google Cloud acquires cloud identity management company Bitium
Google Cloud announced today that it has acquired Bitium, a company that focused on offering enterprise-grade identity management and access tools, such as single-sign on, for cloud-based applications. This will basically help Google better manage enterprise cloud customer implementation across an organization, including doing things like setting security levels and access policies for applications working across their Cloud and G Suite offerings.
Bitium was founded in 2012, and targets both mid market and larger enterprise customers,. It’s been offering a single-stop solution for managing Google Apps, Office 365, social network, CRM, collaboration and marketing tools, while ensuring organizations remain compliant with security standards.
- SAP buys customer identity management firm Gigya for $350M
SAP, the German enterprise software giant, today announced an acquisition to strengthen its hybris e-commerce division. It has acquired Gigya, a firm that helps online properties manage customer identities and profiles. Terms of the deal have not been disclosed officially, but our sources tell us it is for $350 million.
https://techcrunch.com/2017/09/24/sap-is-buying-identity-management-firm-gigya-for-350m/?ncid=rss
- IBM acquires Israeli company Cloudigo
IBM has acquired Israeli data centre company Cloudigo, Globes reported. No financial details were disclosed but the acquisition was for a small amount, according to sources close to the deal. Cloudigo is building next-generation data centre infrastructure and networking services.
IBM Watson and Cloud Platform general manager John Considine said in a blog on IBM’s website that IBM had acquired a high-performance team focused on advanced networking technology that moves the networking function from the server to the edge, increasing data centre efficiency.
https://www.telecompaper.com/news/ibm-acquires-israeli-company-cloudigo–1213172
Artificial Intelligence
- Microsoft Aims to Make Business AI Cheaper, Faster, Simpler
The new product, a customer-service virtual assistant, is designed to let people describe problems in their own words and respond with suggestions drawn from user manuals, help documents and similar materials. Users can request a human agent, in which case the bot will try to assist the customer-care representative. Managers can view a dashboard overview of the results.
The bot is one of what Microsoft says will be a series of customizable programs running on the company’s Azure cloud-computing platform. The programs, called Dynamics 365 AI solutions, will draw on basic AI capabilities such as natural-language processing as well as a trove of data and algorithms from Microsoft’s Bing search engine, productivity apps and LinkedIn network.
https://www.wsj.com/articles/microsoft-aims-to-make-business-ai-cheaper-faster-simpler-1506344400
- Analysis: Amazon Alexa’s biggest healthcare problem? It’s not HIPAA compliant
Alexa, Amazon’s voice technology, creates ample opportunity for physicians and health systems. For example, it could be used as for a remote patient monitoring or to help physicians transcribe notes during patient visits.
While not all health app developers are subject to HIPAA, covered entities and their business associates must be compliant. This means developers can, for example, train Alexa to recommend advice related to health and wellness, but not record patient’s health data in a hospital setting, according to Ms. Farr.
Amazon acknowledged this problem at its “Alexa Diabetes Challenge” event Monday in New York City. The competition invited a series of partners to promote uses for Alexa that would benefit patients with diabetes.
- MIT’s new robot can put on different exoskeletons to gain new powers
These robots could prove incredibly flexible when built at scale, and in more complex configurations. You can imagine deploying a single robot with a range of “suits” to do something like explore the surface of an alien planet, or even to chart more remote portions of our own Earth, and to switch between search and rescue tasks.
Cloud
- Google Goes Tit for Tat With Amazon On Cloud Pricing
Last week, Amazon made a huge change in how it charges businesses for its cloud services, saying it would start to bill on a per-second basis starting Oct. 2 instead of by the hour. Now rival Google is also going to per-second increments, but is making the change effective immediately.
Google’s new price model is for its basic computing units (which it calls virtual machines, or VMs) as well as its container engine and a few other offerings. And the price covers all VMs whether they run Windows Server, Red Hat Linux or SUSE Linux operating systems. Amazon’s per-second pricing applies only to Linux, not to Windows. Google’s pricing on “persistant disk” storage attached to these VMs has been billed per second for quite some time.
http://fortune.com/2017/09/26/google-matches-amazons-price-change/
Datacenter
- Report: HPE to shed 5,000 jobs, or 10% of its staff, by year-end
“If the reports are true, it is sad what has happened to HPE,” said Holger Mueller, vice president and principal analyst at Constellation Research Inc.
Mueller said that although HPE has successfully weathered numerous industry changes in the past, it seems to be losing out in this latest transition where the focus is on things such as artificial intelligence, big data and cloud computing.
“At some point the writing was on the wall with the end of Helion [HPE’s OpenStack cloud product] and with the sale of the software assets,” Mueller said.
https://siliconangle.com/blog/2017/09/21/report-hpe-shed-5000-jobs-around-10-staff-end-year/
Software/SaaS
- Microsoft is going all in on Teams and plans to phase out Skype for Business
Microsoft Teams, the company’s Slack competitor with deep integrations into the Office 365 apps, has seen a lot of pickup over the last few months, with over 125,000 organizations now using it in one form or another. Maybe it’s no surprise, then, that the company today announced it is going all in on Teams as its core communications platform for the enterprise.
Until now, Skype for Business was the company’s product for this. Over the course of the last few years, Microsoft improved the Skype infrastructure to allow for better and faster text chats, calls and video conferences (though some Skype users would surely argue that the quality hasn’t actually improved all that much). But as Ron Markezich, the company’s corporate VP for Office 365 noted ahead of today’s public announcement, Microsoft Teams will evolve “as the core communications client” for its cloud-connected users running Office 365. Teams will become the “hero and primary experience for all voice, video and meetings.” Over time, Teams will replace the current Skype for Business client.
- Micro Focus bosses in line for a £65m payout if they hit merger targets
The executive chairman of Micro Focus could receive a payout of more than £26 million in two years’ time after the British company’s acquisition of Hewlett Packard’s software business.
Kevin Loosemore has been granted options over 1.1 million shares in an additional share grant scheme intended to “incentivise management to deliver exceptional returns to shareholders”. The shares were worth £26.8 million at yesterday’s closing price of £24.36.
- IBM Is Beating Microsoft in This Emerging Tech (Hint: BlockChain)
Moreover, the year-over-year growth of IBM’s “strategic imperatives” (cloud, mobile, social, analytics, and security) has slowed down in recent quarters, torpedoing the bullish notion that its higher-growth businesses can offset the softness of its legacy (IT services, business software, and hardware) businesses.
Nonetheless, the increased adoption of IBM’s blockchain solutions could strengthen its older global business services and technology/cloud platform services units, and potentially expand Big Blue’s enterprise ecosystem. Investors should also remember that the vast majority of the world’s biggest banks, telcos, and retailers still use IBM services — so it has plenty of room to expand its blockchain business.
Therefore, IBM’s lead in the blockchain market might not matter over the next few quarters, but it could widen its moat as more companies secure and streamline their businesses with blockchain solutions.
https://www.fool.com/investing/2017/09/21/ibm-is-beating-microsoft-in-this-emerging-tech.aspx
- Amazon Looks to Deliver Shake Shack, Chipotle Amid Food Push (app)
Amazon has teamed up with a company called Olo, which provides digital order and pay technology to 200 restaurant brands with about 40,000 U.S. locations, potentially giving Amazon access to a slew of delivery orders. Buca di Beppo, which runs about 90 Italian eateries, is the only Olo customer so far to publicly say it will use Amazon Restaurants.
The $1.5 trillion U.S. food market is split roughly between groceries and restaurants. Food deliveries appeal to Amazon because of the frequency of orders, putting it in constant contact with shoppers and helping it collect valuable data about their preferences even if they don’t make much, if any, money on individual transactions.
Other
- IBM Now Has More Employees in India Than in the U.S.
Today, the company employs 130,000 people in India — about one-third of its total work force, and more than in any other country. Their work spans the entire gamut of IBM’s businesses, from managing the computing needs of global giants like AT&T and Shell to performing cutting-edge research in fields like visual search, artificial intelligence and computer vision for self-driving cars. One team is even working with the producers of Sesame Street to teach vocabulary to kindergartners in Atlanta.
https://www.nytimes.com/2017/09/28/technology/ibm-india.html
- Amazon is hiring 2,000 people in New York City as the $5 billion bidding war for its new headquarters rages
The online retail giant is hiring 2,000 more employees over the next three years at a new office in New York City. The office is part of the Manhattan West megadevelopment on the west side of Manhattan.
The company is leasing 360,000 square feet at 5 Manhattan West, with space for its advertising, Amazon Fashion, and Amazon Web Services teams.
http://www.businessinsider.com/amazon-hiring-2000-people-for-new-nyc-office-2017-9
- Equifax CEO Richard Smith to Exit Following Massive Data Breach
Equifax Inc. moved to take concrete action over its massive hack ahead of congressional hearings next week, announcing Tuesday that Chairman and Chief Executive Richard Smith would step aside while leaving the door open to compensation clawbacks.
Mr. Smith, CEO since 2005, is being succeeded as chairman by current director, Mark Feidler, who will serve as nonexecutive chairman, Equifax’s board said. It added that Paulino do Rego Barros Jr., who was most recently Equifax’s president for the Asia-Pacific region, has been appointed interim CEO.
- SEC Draws Scrutiny for Slow Response to Hack
The SEC’s new chairman, Jay Clayton, uncovered the extent of the hack only after he launched a wholesale review of the agency’s cybersecurity vulnerabilities in the spring, according to a statement he released this week. The SEC’s other commissioners learned about the hack in recent days. A former chief operating officer wasn’t told about the intrusion when it was detected last year.
The pace of discovery and the way that information was disclosed is likely to increase scrutiny of an agency that in recent years has pushed financial firms to gird against attacks and urged public companies to tell shareholders about the risks of cyberintrusions. Information about the hack was included in a lengthy statement by Mr. Clayton about the agency’s cybersecurity program that was released just after 8 p.m. on Wednesday evening. The agency didn’t say when the hack occurred or what information hackers accessed.
- Uber Loses Its License to Operate in London
The decision on Friday by Transport for London, which is responsible for the city’s subways and buses, as well as regulating its taxicabs, illustrates the gravity and severity of the issues confronting Uber.
The agency took direct aim at Uber’s corporate culture, declaring that the company’s “approach and conduct demonstrate a lack of corporate responsibility in relation to a number of issues which have potential public safety and security implications.”
Uber’s London license will expire on Sept. 30. But the company has been given 21 days to appeal — it immediately vowed to do so — and will be allowed to continue operating in the city during the appeal process.
https://www.nytimes.com/2017/09/22/business/uber-london.html
- The EU Suppressed a 300-Page Study That Found Piracy Doesn’t Harm Sales
The report found that illegal downloads and streams can actually boost legal sales of games, according to the report. The only negative link the report found was with major blockbuster films:“The results show a displacement rate of 40 percent which means that for every ten recent top films watched illegally, four fewer films are consumed legally.”
The study has only come to light now because Julia Reda, a Member of the European Parliament representing the German Pirate Party, posted the report on her personal blog after she got ahold of a copy through an EU Freedom of Information access to document request.
https://gizmodo.com/the-eu-suppressed-a-300-page-study-that-found-piracy-do-1818629537
- Google Offers Concessions to Europe After Record Antitrust Fine
Google said the changes would be introduced early on Thursday morning, meeting a deadline to open up its shopping platform to greater competition or potentially face further fines from the European Commission, the European Union’s executive arm. As a result, about a dozen shopping sites from companies besides Google could become more visible and accessible.
https://www.nytimes.com/2017/09/27/business/google-eu-antitrust.html
Photo: Jakob Owens
News You Can Use: 9/27/2017
- Some Companies Are Reinventing Job Interviews In Weird (And Possibly Illegal) Ways
Two recent examples come from the New York Times’s Corner Office series with columnist Adam Bryant. In their conversation, Don Mal, CEO of software firm Vena Solutions, tells Bryant that he asks candidates if they’d ever leave their families at Disneyland “to do something that was really important for the company.” This, Mal says, helps him understand applicants’ work ethic. Barstool CEO Erika Nardini shares that she texts candidates over the weekend to see how fast they respond. (Nardini tells Bryant that the acceptable response time, in her view, is within three hours.)
- Former Google Employees Allege Bias Against Women
One plaintiffs, Kelly Ellis, alleged that she was assigned to a lower level than her similarly qualified male counterparts when she was hired as a software engineer on the Google Photos team in 2010. In the complaint, Ms. Ellis claimed she was brought in at a level typically given to new college graduates, despite her four years of engineering experience. She asked for a promotion after learning that she had equal or better qualifications than male engineers in a higher level, and after receiving “excellent performance reviews.” She said she was denied. According to the complaint, Ms. Ellis resigned from Google around July 2014 due to “the sexist culture.”
The claims from the other two plaintiffs, Holly Pease, who managed software engineers, and Kelli Wisuri, a salesperson, follow a similar pattern where they felt their initial positions did not match their qualifications, then found it hard to catch up to male employees and move up the ladder.
- Will AI Result in Mass Unemployment or a New Middle Class?
- The Second-Class Office Workers
The contractor model offers companies lower costs, more flexibility and fewer management headaches. Workers get far less from the arrangement.
Outside workers usually aren’t surprised when they get no paid holidays, sick days, employee-sponsored health insurance, 401(k) plan or other perks routinely offered to traditional employees at the same companies.
What wounds more deeply are things taken for granted or barely considered at all by regular employees, outside workers often say. The work lives of contractors frequently feel like a series of tiny slights that reinforce their second-class status and bruise their self-worth. Even when contracting jobs are easy to get, they can vanish instantly, and turning contract assignments into a real career remains out of reach.
https://www.wsj.com/articles/the-contractors-life-overlooked-ground-down-and-stuck-1505400087
- Growing Up with Alexa (thanks JD!)
It’s a little worrisome. Leaving aside the privacy implications of kids telling an Internet-connected computer all kinds of things, we don’t know much about how this kind of interaction with artificial intelligence and automation will affect how children behave and what they think about computers. Will they become lazy because it’s so easy to ask Alexa and its peers to do and buy things? Or jerks because many of these interactions compel you to order the technology around? (Or both?)
Some of that may happen. It seems more likely, though, that as with many technologies before this, the utility of digital assistants will outweigh their drawbacks. Already they’re making an incredible amount of data and computer-aided capabilities available directly to children—even those not yet in kindergarten—for learning, playing, and communicating. With Alexa, kids can get answers to all kinds of questions (both serious and silly), hear stories, play games, control apps, and turn on the lights even if they can’t yet reach a wall switch. And this is just the beginning of the kiddie AI revolution.
https://www.technologyreview.com/s/608430/growing-up-with-alexa/
From personal experience, once the novelty has warn off, kids don’t care about them. The article’s point about kids being frustrated because the digital assistant can’t hear them is spot on. Other than to turn on a light every once in a while, my son completely ignores Echos we have in the house.
Photo: Bench Accounting
SourceCast: Episode 88: The Equifax Hack
Supplier Report: 9/22/2017
Google is showing the world that crafting hardware is a major ambition for them with the purchase of phone maker HTC’s research division. Google seems to be developing a pattern of buying phone companies for intellectual property (see Motorola), but at least they didn’t buy the entire company this time.
Larry Ellison doing what he does best… making sound-bytes. Larry talked about AWS pricing, the Equifax hack, and Oracle’s new autonomous database product. While I like to poke fun at Larry’s bombastic ways on the podcast, I agree with most of his statements this week.
Oh… and there are rumors of a Sprint and T-Mobile merger for the 1,000,000th time.
Acquisitions
- Google to Buy Part of Phone Maker HTC
With the acquisition, Google may get deeper access to HTC’s research and development, as well as sales and distribution channels, analysts said. That could help Google as it seeks to make a bigger splash in the increasingly competitive smartphone market as it prepares to launch an updated version of the Pixel this fall.
The deal shows “Google is very serious about building its own hardware,” said Jan Dawson, chief analyst at Jackdaw Research.
https://www.wsj.com/articles/google-is-set-to-buy-part-of-taiwanese-phone-maker-htc-1505934852
So why did they sell Motorola again (they took a big loss on that sale)? - T-Mobile and Sprint are in active talks about a merger
Both companies and their parents, Deutsche Telekom and Softbank, have been in frequent conversations about a stock-for-stock merger in which T-Mobile parent Deutsche Telekom would emerge as the majority owner.
People close to the situation stress that negotiators are still weeks away from finalizing a deal and believe the chances of reaching an agreement are not assured. The two sides have not yet set an exchange ratio for a deal, but are currently engaged in talks to hammer out a term sheet.
https://www.cnbc.com/2017/09/19/t-mobile-and-sprint-are-in-active-talks-about-a-merger.html
- Slack lands $250M funding round led by Japan’s Softbank Group
The company said on Sunday it has just closed on a $250 million funding round led by the Japanese telecommunications and Internet giant, which saw the participation of Accel Partners and other investors. The announcement confirms a rumor that first surfaced in July that said Softbank was looking to invest in the company.
The new round means that Slack is now valued at $5.1 billion, up from its previous $3.8 billion valuation, Bloomberg reported. However, that figure remains well below the reported $9 billion takeover price that was bandied about when rumors emerged that cloud computing giant Amazon Web Services Inc. was interested in acquiring the company.
https://siliconangle.com/blog/2017/09/17/slack-lands-250m-funding-round-led-japans-softbank-group/
Artificial Intelligence
- Computers Are Taking Design Cues From Human Brains
Now, computer engineers are fashioning more complex systems. Rather than funneling all tasks through one beefy chip made by Intel, newer machines are dividing work into tiny pieces and spreading them among vast farms of simpler, specialized chips that consume less power.
Changes inside Google’s giant data centers are a harbinger of what is to come for the rest of the industry. Inside most of Google’s servers, there is still a central processor. But enormous banks of custom-built chips work alongside them, running the computer algorithms that drive speech recognition and other forms of artificial intelligence.
- Google’s AI chief thinks reports of the AI apocalypse are greatly exaggerated
The company also needs to share the architecture of its AI products because Google wants to avoid biases as much as possible. “We have been spending a lot of time looking at machine learning fairness,” Giannandrea said. “If your data is biased, then you build biased systems. We have many efforts at Google and research collaboration around this question of fairness in machine learning and unbiased data.”
And finally, the term artificial intelligence itself might not be the right one. According to Giannandrea, artificial intelligence doesn’t mean much. “I almost try to shy away from this term artificial intelligence — it’s kind of like big data,” he said. “It’s such a broad term, it’s really not well defined. I’ve been trying to use the term machine intelligence.”
Cloud
- Amazon Web Services will now charge by the second, its biggest pricing change in years
The move is historically significant. Since AWS became available in 2006, it has charged by the hour. Then, in 2013, Alphabet’s Google, which had introduced its direct competitor to AWS a year earlier, said it would start charging by the minute, after a 10-minute minimum. Microsoft’s Azure followed suit shortly thereafter.
Now Amazon is hitting back by becoming even more granular when it comes to making people pay only for the computing resources they use, with a one-minute minimum.
The price change is only applicable for Linux virtual machines, AWS’ chief evangelist, Jeff Barr, wrote in a blog post.
https://www.cnbc.com/2017/09/18/aws-starts-charging-for-ec2-by-the-second.html
- Amazon’s AWS is Now Hosting the Defense Department’s Most Classified Data
Earlier this week, the DoD granted Amazon a provisional authorization to host its Impact Level 5 workloads, which are the Pentagon’s and U.S. military’s most classified information. Only two other tech companies are allowed to store this data: Microsoft MSFT and IBM IBM .
“This further bolsters AWS as an industry leader in helping support the DoD’s critical mission in protecting our security,” said Amazon in a statement . “The AWS services support a variety of DoD workloads, including workloads contained sensitive controlled unclassified information and National Security Systems information.”
- Oracle’s Larry Ellison pokes Amazon again with new cloud pricing plan
Actually, Ellison claimed that Oracle’s infrastructure runs faster and therefore ends up costing less, but it’s clear that the company is focusing more on its traditional strengths one tier up from the infrastructure: so-called platform as a service offerings such as the Oracle Database. So today, Oracle said it will allow customers to move their existing licenses for databases, middleware and analytics to Oracle’s platform services, just as they’ve allowed them to bring licenses to its infrastructure before.
“The way we want to compete is to deliver a high degree of automation to our customers,” Ellison told press, customers and Oracle employees at the event. And the biggest payback, he said, will be in eliminating human error. “If you don’t patch the database at Equifax, thatoraclecloudpricing could be expensive,” he said pointedly.
https://siliconangle.com/blog/2017/09/19/oracles-larry-ellison-pokes-amazon-new-cloud-pricing-plan/
Software/SaaS/Security
- Equifax Breach ‘Won’t Be Isolated Incident,’ Says Oracle Founder Larry Ellison
Warning that the world is in the midst of “a cyber war that’s going to be going on for a long, long time,” Ellison said the challenge for not only Oracle but the tech industry overall is to dramatically enhance its cybersecurity capabilities across two very different types of environments: the data centers many big customers currently operate, and the cloud-computing data centers to which many businesses are turning for their computing, applications, and storage needs.
And the key technology in this counteroffensive, Ellison said, is machine learning—and specifically how it can enhance cybersecurity via extensive analysis of log data.
“Based on machine learning, this new version of Oracle Database is a totally automated and self-driving system that does not require a human being either to manage the database or tune the database (emphasis mine),” Ellison said.
“Using artificial intelligence to eliminate most sources of human error enables Oracle to deliver unprecedented reliability in the Cloud.”
Other
- Google Has Spent Over $1.1 Billion on Self-Driving Tech
Now, a court filing in Waymo’s epic and ongoing lawsuit against Uber has accidentally revealed just how big a bet Google placed on autonomous vehicles. Between Project Chauffeur’s inception in 2009 and the end of 2015, Google spent $1.1 billion on developing its self-driving software and hardware, according to a recent deposition of Shawn Bananzadeh, a financial analyst at Waymo.
Bananzadeh was testifying as part of the lawsuit, in which Uber stands accused misappropriating trade secrets and violating patents from Waymo, Google’s self-driving-car offshoot. Because Waymo has yet to commercialize any of its technology in a meaningful way, the company thinks any damages in the case should be calculated on the basis of how much it spent building the technology in question.
- Cisco Chairman John Chambers to Step Down, Ending an Era at Tech Company
Mr. Chambers, who has been executive chairman for two years and chairman since 2006, notified board members of his decision in an email last Wednesday.
“It is time for Cisco to move on to its next generation of leadership,” he said in the letter. “It is also time for me to move on to the next chapter of my life, on both a personal and business level.”
Cisco plans to appoint Chief Executive Chuck Robbins, 51 years old, to fill the role.
Mr. Chambers, 68, was Cisco’s CEO for more than 20 years ending in 2015, when Mr. Robbins took over. Neither Mr. Chambers nor Cisco shared details about his next plans.
- Equifax Stock Sales Are the Focus of U.S. Criminal Probe
The federal probes add a serious challenge to Equifax as lawmakers, state attorneys general and regulators scrutinize the breach that may have compromised the privacy of 143 million U.S. consumers. Equifax shares were little changed. The shares have fallen 35 percent since the breach was disclosed after market close in New York on Sept. 7.
Investigators are looking at the stock sales by Equifax’s chief financial officer, John Gamble; its president of U.S. information solutions, Joseph Loughran; and its president of workforce solutions, Rodolfo Ploder, said two of the people, who asked not to be named because the probe is confidential.
Photo: ANGELA FRANKLIN