IBM had a rough week with stock prices dropping almost 6% due to stagnating sales. Some analysts are saying that “big blue” is now too small to compete against the cloud giants and does not have enough cash reserves ($12B) to make any major acquisitions to help them catch up. Bad news aside, the company did unveil the world’s smallest computer which costs 10 cents to make and has the computer power of a 1990’s era PC (think IoT applications).
Qualcomm is planning on cutting 4% of their workforce to yield $1B in cost reductions. Apple would like to find and cut the person leaking insider information, which was discovered by the press… due to a news leak. The company is also having problems finding customers for their HomePod personal assistant in a market saturated with devices listening to every conversation you have in your home.
Acquisitions
- Adobe acquires voice interface platform Sayspring
Adobe today announced that it has acquired Sayspring, a startup that helps developers prototype and build the voice interfaces for their Amazon Alexa and Google Assistant apps. The company says the Sayspring team will join Adobe tomorrow and that it’ll then start integrating the company’s technology into its own products.
All of Saysprings services are now available for free — but there is a catch. If you want to sign up for the service now, you’ll need an invite. Sayspring says it’ll select invitations and roll out new invites on a rolling basis.
https://techcrunch.com/2018/04/16/adobe-acquires-voice-interface-platform-sayspring/
Artificial Intelligence
- Elon Musk says ‘humans are underrated,’ calls Tesla’s ‘excessive automation’ a ‘mistake’
“Excessive automation at Tesla was a mistake,” Musk wrote, responding to a Wall Street Journal reporter’s tweet. “Humans are underrated.” He also talked about this with CBS News’ Gayle King, adding “we had this crazy, complex network of conveyor belts….And it was not working, so we got rid of that whole thing.”
Tesla has faced mounting public pressure amid a production slowdown for its Model 3, its lower-priced car. The company recently revealed that it missed its target to produce 2,500 cars a week, disappointing investors.
- AI isn’t ready for prime time because of bad data, say marketers
During a closed-door town hall session on April 12, one brand executive asked fellow marketers if the data being fed to AI programs today is bad data that may lead to ill-informed results. “I don’t think it’s a question. We’re making decisions off of bad data,” responded one.
Fortunately for marketers, they aren’t yet using AI to make major business decisions. The examples that attendees most frequently cited during the summit were tailoring product recommendations and personalizing marketing communications. And even to the extent that marketers use AI to make major decisions, they are using it as a gut check. “I think AI is all about decision support. It’s there to tell you what not to do,” said one attendee.
But brands hope to eventually use AI to automate more of their businesses. One brand exec said she hopes AI can automate approval processes and ensure her company adheres to regulatory requirements.
https://digiday.com/marketing/ai-isnt-ready-primetime-bad-data-say-marketers/
- Half of all jobs can today be automated — and within 50 years, all of them can be
“A large part of the increased income from productivity accrues to already rich people…you may get a proliferation of low-income service jobs rather than a further increase in productivity,” said Turner.
An example of this effect is the British online food delivery company Deliveroo where, as a result of improved technology, minimum-wage jobs of delivering food on a bicycle have proliferated, he said.
This phenomenon is also evident in the United States, as the jobs expected to grow the most from 2014 to 2024 are personal care aides, food serving workers, and operation managers, according to data released by the Bureau of Labor Statistics.
“These low-paying service jobs are growing because they for now cannot be automated and because wages are low enough to make automation uneconomic,” Turner explained.
Cloud
- Oracle Is Leading Anti-Amazon Lobby on Pentagon Cloud Bid
The Oracle-led effort relies on a loose coalition of technology companies also seeking a slice of the Pentagon work, including Microsoft Corp. and International Business Machines Corp., said the people, who described the matter on condition of anonymity. Dell Technologies Inc. and Hewlett Packard Enterprise Co. are also participating, said one of the people.
Their goal is to make sure that the award process is opened up to more than one company and unseat Amazon as the front-runner for the multibillion-dollar deal. As part of the campaign, the people said, Oracle is holding regular calls with tech allies, courting trade and mainstream media and lobbying lawmakers, defense officials and the White House.
Also: (this ties back to SourceCast 113)
While Oracle’s $187 billion market value is less than a third of Amazon’s, it punches way above its weight in Washington, where it has a team of seasoned policy officials and personal relationships that go all the way to the top.
Trump personally ordered the Justice Department to hire Oracle’s Ezra Cohen-Watnick to advise Attorney General Jeff Sessions on national security matters, according to people familiar with the matter. Cohen-Watnick went to Oracle in August after leaving the National Security Council, where he had been caught up in a controversy over the release of intelligence material to a member of Congress, according to people familiar with the matter.
- A Tech Giant No More: IBM Is Too Small to Compete in the Cloud Era
Its latest quarter shows revenue of $19.1 billion, and net income of $1.7 billion, $1.81 per share. That’s just two thirds of what Microsoft Corporation (NASDAQ:MSFT) brought in last quarter. Microsoft’s market cap of $742 billion is more than five times IBM’s $137 billion market cap.
The best reason to buy IBM for years has been its dividend, now yielding 4.03%. But that dividend, $1.50 per share per quarter, is soaking up an ever-greater portion of earnings and will take almost $1.4 billion to service. It means the company only has $12 billion in cash. By contrast Facebook, Inc. (NASDAQ:FB), the least well-capitalized of the “Cloud Czars,” has $40 billion in cash and short-term securities to sustain its investments.
IBM simply lacks the financial firepower to win the DoD contract, because it prioritized shareholders over investment early in this decade. Facebook, Amazon, Microsoft, Apple Inc. (NASDAQ:AAPL) and Alphabet Inc (NASDAQ:GOOGL) did make the commitment to investment, and as a result, history passed IBM by.
Security
- In a Leaked Memo, Apple Warns Employees to Stop Leaking Information
Leaked information about a new product can negatively impact sales of current models, give rivals more time to begin on a competitive response, and lead to fewer sales when the new product launches, according to the memo. “We want the chance to tell our customers why the product is great, and not have that done poorly by someone else,” Greg Joswiak, an Apple product marketing executive, said in the memo.
The crackdown is part of broader and long-running attempts by Silicon Valley technology companies to track and limit what information their employees share publicly. Firms like Google and Facebook Inc. are pretty open with staff about their plans, but keep close tabs on their outside communications and sometime fire people when they find leaks.
- Smart Speakers And Their Potential Privacy Concerns
“‘When you read parts of the applications, it’s really clear that this is spyware and a surveillance system meant to serve you up to advertisers,” Consumer Watchdog President Jamie Court told The New York Times. These companies are “basically going to be finding out what our home life is like in qualitative ways.”
He supports his notions through the patent details.
“The processor [of the computing system] is configured to use the first data to determine which user is occupying a smart-device environment” and “the properties comprising age, gender, fashion-taste, mood, preferred activities, medical condition, or some combination thereof,” the official filing reads.
http://dailycaller.com/2018/04/14/smart-speakers-privacy-concerns-alexa/
Software/SaaS
- Why Amazon Now Wants to Disrupt the P2P Payments Industry
Just weeks after news leaked that Amazon (NASDAQ:AMZN) might be interested in launching a checking account-like product, The Wall Street Journal is reporting that the company might also be looking into debuting a new peer-to-peer (P2P) payment platform. While details are far from set on how such a service might operate, one idea being floated is to enable Alexa, Amazon’s voice-based smart-home companion, to make payments to friends and family members.
If the information leaked to The Wall Street Journal is accurate, it wouldn’t be Amazon’s first foray into P2P payments. Years ago, Amazon operated WebPay, a service that allowed Amazon Payments members to send and request money by entering the amount and a contact’s email address on a web page. Amazon eventually shut the service down after it failed to gain traction. As the company explained on its site at the time, “We are not addressing a customer pain point particularly better than anyone else.”
https://www.fool.com/investing/2018/04/13/why-amazon-now-wants-to-disrupt-the-p2p-payments-i.aspx
- Microsoft built its own custom Linux kernel for its new IoT service
Why use Linux? “With Azure Sphere, Microsoft is addressing an entirely new class of IoT devices, the MCU,” Rob Lefferts, Microsoft’s partner director for Windows enterprise and security told me at the event.” Windows IoT runs on microprocessor units (MPUs) which have at least 100x the power of the MCU. The Microsoft-secured Linux kernel used in the Azure Sphere IoT OS is shared under an OSS license so that silicon partners can rapidly enable new silicon innovations.” And those partners are also very comfortable with taking an open-source release and integrating that with their products.
Datacenter/Hardware
- IBM Unveils World’s Smallest Computer And Its Amazing
For the terribly tiny size, it sure packs a punch of processing power. It has a processing power of an X86 chip from 1990. You may think that it is not that powerful but remember, we need a microscope to clearly see the chip.
The computer will cost less than ten cents to manufacture, and will also pack “several hundred thousand transistors,” according to the company. These will allow it to “monitor, analyze, communicate, and even act on data.”
https://www.technotification.com/2018/04/ibm-worlds-smallest-computer.html
- Is Apple’s HomePod failing?
For me, it’s Apple’s refusal to compromise on the practical things that kills any reason for me to buy the HomePod, despite being a fully paid-up Apple fanboy. I’d love, for instance, to use the HomePod with Spotify like I do with the Google Home Mini. Or, even better, use an optical-in connection to connect it to my TV and use it as my home’s primary speaker. The same product with one tiny concession to the real world would be a much more popular product, for sure. And don’t get me started on the lack of Bluetooth. You can argue that even with AptX it’s lower quality audio, but its omission is a raised middle finger to everyone.
https://www.engadget.com/2018/04/13/apple-homepod-failing-editorial/
Other
- Supreme Court Weighs Widening States’ Reach on Online Sales Taxes
The current tax rules—from the era of mail-order catalogs—helped fuel the rise of internet commerce and spurred frustration among brick-and-mortar retailers, shopping-mall owners and state governments.
Tax and legal experts expect the court to overturn the precedent, freeing states to collect levies on future cross-state transactions. It isn’t clear what new standard might take its place or what rules states might impose.
- Backpage.com CEO pleads guilty to human trafficking
Documents unsealed today by the Justice Department (PDF) reveal Backpage.com CEO Carl Ferrer pleaded guilty to federal conspiracy charges in Arizona on April 5th, a day before the site was seized and shut down. Additionally, attorneys general in California and Texas announced today that the site itself has entered a guilty plea to charges of human trafficking in Texas, while Ferrer pleaded guilty to conspiracy and three counts of money laundering in California. Several corporate entities tied to the site, including Backpage.com LLC, also entered guilty pleas to charges of money laundering.
As a part of the deal that will see him serve a maximum of five years in prison, the prosecutors say Ferrer has surrendered the URLs of the site and its data to law enforcement, and that he will cooperate in the prosecution against others involved with the company — namely co-founders and controlling shareholders Michael Lacey and James Larkin, who were indicted April 9th.
https://www.engadget.com/2018/04/12/backpage-ceo-pleads-guilty-to-human-trafficking-money-launderin/
- IBM Falls After Quarterly Margins Narrow and Sales Stagnate
International Business Machines Corp. reported first-quarter sales of $19.1 billion, beating the average analyst estimate of $18.8 billion. That’s a 5 percent gain since last year, but only when the weak U.S. dollar was factored in. Without it, revenue growth was unchanged. Growth in the key “strategic imperatives” business lines — which includes the company’s cloud, analytics and mobile-focused businesses — was up 10 percent from a year earlier to $9 billion when adjusted for currency changes.
The stock dropped as much as 5.8 percent, to $151.54, in extended trading after ending the day up 1.9 percent.
Chief Executive Officer Ginni Rometty is working to pull IBM back from over five years of revenue declines. She reversed the trend late last year though that boost wasn’t fueled as much by the new businesses as by cyclical demand for mainframe servers. Investors are watching closely to see whether she can ramp up gains in IBM’s newer software and services to sustain the improvement when the bump from hardware sales fades.
- Qualcomm Job Cuts Total 4.4% of Workforce So Far
Qualcomm is cutting 4.4% of its workforce starting in June, according to documents filed with the state of California. The layoffs include 1,231 employees in San Diego, where the chip maker has its headquarters, and 269 in San Jose and Santa Clara, according to the documents.
The company employed 33,800, including part-time workers, as of September 2017, according to a regulatory filing.
The $1 billion cost-reduction program is part of a profit-boosting plan unveiled in January, intended to persuade investors the company would be more valuable on its own than combined with Broadcom Corp. , which at the time was pursuing a hostile takeover bid. President Donald Trump scuttled Broadcom’s overture with a March executive order blocking a deal on national security grounds.
https://www.wsj.com/articles/qualcomm-cuts-jobs-to-boost-profit-1524115042?ns=prod/accounts-wsj
Photo by Brianna Santellan on Unsplash