Tech Brew Ride Home - Fri. 02/14 - Is It Time For a $500 PlayStation?

Episode Date: February 14, 2020

The DOJ charges a bitcoin mixing service. A judge has blocked Microsoft’s JEDI contract. What happens if the PlayStation 5 is $500? Google takes down some malicious browser extensions. And, of course, the Weekend Longreads Suggestions. Sponsors: DoubleUp.agency Netgear.com/bestwifi Links: Ohio man arrested for running Bitcoin mixing service that laundered $300 million (ZDNet) Judge temporarily blocks Microsoft Pentagon cloud contract after Amazon suit (CNBC) Sony Is Struggling With PlayStation 5 Price Due to Costly Parts (Bloomberg) Google removes 500+ malicious Chrome extensions from the Web Store (ZDNet) Weekend Longreads Suggestions: Inside Mark Zuckerberg's Lost Notebook (Wired) THE HIGH COST OF A FREE CODING BOOTCAMP (The Verge) Cost Cutting Algorithms Are Making Your Job Search a Living Hell (Vice) Are Algorithmically-Generated Term Papers the Next Big Challenge to Academic Integrity? (EdSurge) SoftBank’s $375 Million Bet on Pizza Went Really Bad Really Fast (Bloomberg BusinessWeek) How a Space Engineer Made Her Own Rotary Cell Phone (Wired) Learn more about your ad choices. Visit megaphone.fm/adchoices

On April 4th, 2023, around 2 in the morning, a man was found stabbed multiple times on a sidewalk in downtown San Francisco. Hey, who did this to you? What happened next turned the story into a political firestorm. Reports have identified the victim as Bob Lee, the founder of Cash App. From Bloomberg Podcasts, this is Foundering, the Killing of Bob Lee, beginning April 16. Welcome to the Tech meme right home for Friday, February 14th, 2020. I'm Brian McCullough. Today, the DOJ charges a Bitcoin mixing service. A judge has blocked Microsoft's Jedi contract. What happens if the PlayStation 5 is $500? Google takes down some malicious browser extensions and, of course, the weekend long-read suggestions. Here's what you miss today in the world of tech. The feds have really been busy lately. The Department of Justice has charged the owner of Helix, a dark web Bitcoin mixing service, operating from 2014 to 2017, with allegedly laundering Bitcoin's worth more than $300 million at the time. Now, a mixer service is specifically designed

to disguise the origin of Bitcoin transactions. So, yeah, crypto laundering, if you will. Quoting ZDNet. Larry Harmon, 36 of Akron, Ohio, stands accused in a three-count indictment for operating Helix, an online website located on the dark web. The Bitcoin blockchain is a public database. In many cases, purchases of new Bitcoin funds acquired by a user can sometimes be linked to a credit card, bank account, or PayPal account. Helix functioned as a Bitcoin mixer or Bitcoin Tumblr. A type of service that takes funds from a user, splits the sums into small parts, and using thousands of transactions, sends and reassembles the original funds at a new Bitcoin address.

in an effort to hide the original funds under a cloud of micro-transactions. Quote, the sole purpose of Harmon's operation was to conceal criminal transactions from law enforcement on the darknet, and because of our growing expertise in this area, he could not make good on that promise. Don Fort, chief IRS criminal investigation officer said today in a Department of Justice press release, end quote. In other legal news, a judge has ordered a temporary block on Microsoft being awarded that Jedi cloud contract, with the Pentagon. This is after Amazon filed suit claiming that, well, there's kind of really no other way to put it, claiming that Amazon didn't get the contract because the president of the United States doesn't like Jeff Bezos, allegedly. Quote, in April, the Defense Department announced that

Amazon and Microsoft were the two finalists to provide the contracts ruling out other contenders such as IBM and Oracle. Then in July, President Donald Trump said he was looking into the contract after IBM and other companies protested the bidding process. Microsoft was ultimately awarded the contract last October. Amazon has been protesting the move saying that it was driven in part by Trump's bias against the company. Trump often criticizes Amazon and its CEO Jeff Bezos, who also owns the Washington Post, claiming the newspaper unfairly covers his administration. Court documents filed last December laid out in greater detail why AWS is challenging the decision. In them, AWS alleged Trump launched, quote, behind the scenes attacks, end quote, against the company, which caused it to lose out.

the cloud contract. AWS has called for the Defense Department to terminate the award and conduct another review of the submitted proposals, end quote. I don't think I mentioned it, but earlier this week, unsealed documents in this case revealed that Amazon wants to depose Defense Secretary Mark Esper and former Defense Secretary James Mattis, as well as President Trump himself, which, if that happened, that would be interesting. sources are telling Bloomberg that Sony's PlayStation 5 might end up costing as much as $470 or more at retail due to scarce components,

which have pushed up manufacturing costs for the next-gen console expected to be released by the end of the year. Sony released the PS4 at a retail price of $399, even though it probably cost $381 to manufacture. So slim margins there. But now analysts are telling Bloomberg that component prices on the PS5 would bring the bill of manufacture to $450 at least. Thus, if Sony wanted to eke out the same slim margin, it would need to be priced at at least $470. The most expensive PlayStation right now is the PS4 Pro right at that $399 price point. So are we inching towards $500 here, quoting Bloomberg. The company's biggest headache is ensuring a reliable supply of DRAM and flash memory,

with both in high demand as smartphone makers gear up for fifth-generation devices, according to people familiar with Sony's operations. Samsung just announced its Galaxy S-20 product range, each variant of which will have 5G and a minimum of 12 gigabytes of RAM in the U.S. Video game companies often sell hardware at thin margins or even at a loss because they profit from lucrative game software and recurring online subscription services. Sony's chief executive officer, Kenichiro Yoshida, has said the business should be judged by the number of active users, not the number of hardware units sold.

Some Sony games staff think it should sell the new console at a loss, if necessary, to match Microsoft's price, while other Sony executives would prefer to make money, as the company did with the PS4. quote, we must keep PlayStation 5's bill of materials under our control and we need to make the correct number of units in the initial production. Sony's chief financial officer Hiroki Totoki said at an earnings briefing earlier this month, end quote. But yeah, one does wonder if Sony will be forced to sell the console at a loss at some point and actually maybe all the console makers will have to going forward. What with all the cloud gaming coming and the big pocketed competitors entering the space? gaming in general is facing potential commodification.

That's the problem when you have to make money on every widget you sell, but suddenly you're doing business against big tech platform oligarchs that don't need to make money on gaming at all, or at least not right away. They just need to win at gaming full stop. And winning and making money don't always align at the same point in time. And hey, maybe that's the point. If gaming is going to every screen, if it is going to become a commodity,

then maybe the incumbent players should just say, heck with it. And own that real high-end gaming should be a more expensive proposition. As Arthur Gies tweeted, quote, this opens the door pretty wide to a $500 price of entry for PS5 and Xbox Series X this fall, which makes the prospect of a much cheaper Series S console that much more attractive, end quote. But as Chase just Chase tweeted, on Twitter. It's funny that people will spend $1,000 on a phone that will last three years, but it's an issue if the price of a console with a 10-year shelf life is over $400, end quote.

Heads up that Google has removed more than 500 malicious Chrome extensions from its web store, likely affecting millions of users. The extensions were apparently a part of a long-running ad-fraud network, quoting ZDNet. The removed extensions operated by injecting malicious ads, malvertising, inside users browsing sessions. The malicious code injected by the extensions activated under certain conditions and redirected users to specific sites. In some cases, the destination would be an affiliate link on legitimate sites like Macy's Dell or Best Buy, but in other instances, the destination link would be something malicious, such as a malware download site or a fishing page, end quote. This was all unearthed in a two-month

joint investigation between security researcher Jamila Kea and Cisco's duo security team. It's unclear how many users had installed the extensions, but the first series of extensions that researchers identified had an install count of 1.7 million Chrome users by themselves. If you had one of these extensions, Google has already deactivated it inside your browser and marked it as malicious so you'll know not to reinstall it. Time for the weekend long read suggestions. The great Stephen Levy has a new book coming out in two weeks called Facebook. The Inside Story. Wired Magazine has the first excerpt from the book, and it's interesting. Stephen apparently got his hands on actual journals Mark Zuckerberg kept while the company was young, quote, the notebooks have now mostly disappeared, destroyed by Zuckerberg himself.

He says he did it for privacy reasons. This is in keeping with sentiments he expressed to me about the pain of having many of his early IMs and emails exposed in the aftermath of legal proceedings. Quote, would you want every joke that you made to someone being printed and taking out of context later, he asks? Adding that the exposure of his juvenile jottings is a factor in his current push to build encryption and ephemorality into Facebook's products. But I discovered that those early writings aren't totally lost. Snippets, presumably those he copied and shared, present a revealing window into his thinking at the time. I got a hold of a 17-page chunk from what might be the most significant of his journals in terms of Facebook's evolution. He named it Book of Change.

Dated May 28, 2006, the first page has his address and phone number with a promise to pay a $1,000 reward for return of the book if lost. He even scrawled an epigram, a message to himself. Be the change you want to see in this world. Mahatma Gandhi, end quote.

Read the excerpt from the book for all of the excerpts from the journals. Next, the Verge has a look at the Lambda School. Lambda, Lambda. Lambda. That coding boot camp that you may have heard about where you pay nothing up front but then pay back a percentage of your salary later after you've landed an actual coding job. Based on this one piece, shall we say, with Lambda caveat emptor, quote, Diverge had an outside engineering expert, Ben Sandowski, review Lambda's iOS curriculum and give feedback on the overall quality.

Sandowski, who has 16 years of programming experience and previously worked as a mobile engineer at Twitter before starting the popular iPhone camera app, Halid, said the program doesn't prepare people to pass even a first-round tech interview. After looking through Lambda school's curriculum, I'd say students are going to struggle with very basic questions you'll get on first phone screens, he explains. Sandowski also looked at Lambda student projects on GitHub and was shocked at the basic errors students were making. Out of 10 student projects available, five should have failed, he says. It appears that they all passed. I reached out to one of the students who made a mistake to ask if he ever received feedback, and he said he had not, end quote. Next, two pieces about our new algorithmic overlords. Vice takes a look at how companies are increasingly using job screening systems to vet candidates,

which is causing job seekers to have to jump through crazy hoops just to get their resumes in front of actual human eyes. quote, Lynn Williams, a Philadelphia area career advisor, holds a seminar called Beating the Applicant Tracking System. Every time, she braces for a wave of anger from the audience. I can feel their blood pressure rise when I tell them what they're doing wrong, she said. Their most important tasks, she tells crowds of job seekers is to parrot keywords from job descriptions. The most basic elimination function at most ATS software is searching resumes and cover letters for keywords. Many systems can't or don't bother to distinguish synonyms like manager and supervisor,

so she says to rewrite resumes with each application mindlessly copying words from the job description. Countless online guides for beating the bots recommended the same, end quote. And an outlet called Ed Surge asks if algorithmically generated term papers are a coming challenge in academia generally. The internet and machine learning is going to totally shake up what education is. is and how we validate when students have knowledge that we can verify, argues Trisha Bertram Gallant, director of the Academic Integrity Office at the University of California, San Diego. She says that EssaySoft and other AI-based paper writers, she has seen spit out results that wouldn't fool many professors today. Right now, it's bad. Often it's nonsensical, she says.

A student was supposed to write about big data and the essay generator called it enormous information, or it changed the name Frank to the word candid. And some companies may be outputting low-quality papers on purpose in an effort to upsell the students to a human essay writer, she adds. But as the technology improves, such bots may soon churn out passable work with zero effort by the students who use them. Within five years, she predicts, these essay generators will be good enough that they won't have to hire people anymore. They can just have the essay generator do it, end quote. With the way we've already seen this sort of technology improve in just the half decade, I have absolutely no doubt by the end of this decade, this will be absolutely perfected.

And no, I can't resist. Check out Business Week's deep dive into Zoom, the robotic pizza making machine that SoftBank poured $375 million into. Zoom is not shutting down operations, at least not yet, like Brandlis did, but, quote, Zoom marks one of the biggest recent to, appointments in SoftBank's portfolio. As of this year, it no longer makes or delivers pizzas. In January, Zoom cut 360 jobs, leaving a little over 300 employees and said it would focus on packaging and efficiency gains for other food delivery companies. In a note to employees, Garden said that improving the global food system required increased focus and that the pizzas had served as inspiration for higher growth businesses, end quote. The point is, and the reason

and I keep coming back to these stories, is even one embarrassment like a Zoom or a brandless or a we work would be enough to sink the reputation of most investment funds. For SoftBank, the big swings and misses just keep piling up. And if you read all of these stories like I do, the theme in all of them is essentially the same. Basically, very little diligence was done. It was just, here, take this giant pile of money and come talk to me again when you're to IPO. And finally, I like to sometimes share little projects with you that maybe you could read about and then do yourself if you were so inclined. This one might not exactly be easy for you to

replicate or something that would be that intriguing, but check out this story in Wired about an astronomy instrumentation engineer at Brookhaven National Laboratory in New York, who took parts from an old rotary phone and made it into a working cell phone. Quote, Hap's goal with the rotary cell was two-pronged. She wanted to strip a mobile phone down to its absolute essentials while giving her an even more legitimate excuse for not text messaging her friends. The point isn't to be anachronistic, Hapte wrote on her website,

it's to show that it's possible to have a perfectly usable phone that goes as far from having a touchscreen as I can imagine and which in some ways may actually be more functional, end quote. Check out the finished project, or at least the photos, because they're pretty cool. That's one way to stand out from everyone else's slab of black glass, I guess. Get yourself a rotary mechanism from an old trimline telephone. Happy Valentine's Day, my friends, go be with someone you love tonight. One weekend bonus episode this weekend coming tomorrow,

following up on the big Samsung event earlier this week. Talk to you on Monday.