Tech Brew Ride Home - Fri. 05/15 – Facebook Buys GIPHY

Starting point is 00:00:00 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, May 15th, 2020. I'm Brian McCullough today. Facebook buys Jiffy. The U.S. strikes at Huawei again. Apple acquires a VR startup. Is Silicon Valley really about to become a ghost town? And of course, the weekend long read suggestions. Here's what you missed today in the world of tech. The U.S. is banning the sale of semiconductor and semiconductor designs using U.S. software to Huawei, quoting Reuters. The U.S. Commerce Department said, it was amending an export rule to strategically target Huawei's acquisition of semiconductors that are the direct product of certain U.S. software and technology.

Starting point is 00:01:17 The reaction from China was swift, with a report saying it was ready to put U.S. companies on an unreliable entity list as part of countermeasures in response to the new limits on Huawei. China's Global Times reported on Friday. The measures include launching investigations and imposing restrictions on U.S. companies such as Apple, Cisco, Qualcomm, as well as suspending purchase of Boeing airplanes, the report said, citing a source. Reuters first reported the news ahead of the Commerce Department's release. The department said its announcement cuts off Huawei's efforts to undermine U.S. export controls, end quote. The rule change is a blow to Huawei, the world's number two smartphone maker,

Starting point is 00:01:55 as well as to Taiwan's Taiwan semiconductor manufacturing, a major producer of chips for Huawei's high silicon unit as well as mobile phone rivals Apple and Qualcomm. Taiwan Semiconductor announced late Thursday it would build a $12 billion chip factory in the U.S. State of Arizona. Taiwan Semiconductor said Friday, it is, quote, working with outside councils to conduct legal analysis and ensure a comprehensive examination and interpretation of these rules. We expect to have the assessment concluded before the effective date, the company said, adding the semiconductor industry supply chain is extremely complex and is served by a broad

Starting point is 00:02:30 collection of international suppliers, end quote. That was a bit of breaking news from this morning, and this just broke mere moments ago when I was typing this out. Dan Premack and Kia Kukalacheva at Axios are reporting that Facebook has agreed to buy Jiffy in a deal valued at $400 million, quoting from the short article that is live right now on Axios. A source close to the situation says that the two companies first began talking prior to the pandemic, although that was more about a partnership than an acquisition. Jiffy is expected to retain its own branding with its primary integration to come via Facebook's Instagram platform. New York-based Giffy had raised around $150 million in VC funding since its 2013 inception from the likes of Betawks, Lera Hippinaw,

Starting point is 00:03:20 IVP-DFJ growth, GGV Capital, and Lightspeed Venture Partners. Its most recent private, it valuation was around $600 million, end quote. In an accompanying blog post, Facebook says Giffie will become part of Instagram. They also said that 50% of Giffy's traffic already was coming from Facebook's family of apps. Apple has confirmed that it is acquiring California-based VR startup Next VR for what folks believe is a valuation of around $100 million. This is from Bloomberg. The acquisition may help Apple's development of VR and AR headsets with accompanying software and content. Next VR supplies content to several existing VR headsets, including Facebook's Oculus and devices from Sony, HTC, and Lenovo. Next VR has deals with sports leagues, including the National

Starting point is 00:04:17 Basketball Association and Entertainment Networks such as Fox Sports. The startup also has expertise in live streaming and virtual reality, which could be useful for live concerts and games. The Newport Beach, California-based startup officially shut down this week, saying on its website that it is, quote, heading in a new direction, end quote. Which, speaking of, good old Minci Quo is out with a research report saying, among other things, that Apple is planning a 10.8 inch iPad release in the second half of this year, a new iPad mini release in the first half of next year. But the interesting thing is he also posits that the rumored Apple AR glasses won't come until 2022 at the earliest.

Starting point is 00:05:04 Quote, Apple is preparing an affordable 10.8-inch iPad that could launch in the second half of 2020 and a new mini-sized iPad between 8.5 and 9 inches for the first half of next year, the analyst said. The two new iPad models will follow iPhone SE's product strategy and selling points will be the affordable price tag and the adoption of fast chips, he continued. As for the AR glasses, quoting again, Apple is working on virtual and augmented reality as a potential new product category. Quo believes that Apple's glasses are years away and will use a pricey laminated lens to display digital content overlaid on top of the real world, end quote.

Starting point is 00:05:43 But not so fast, says noted Apple rumor leaker John Prosser, who tweeted, quote, I can't believe I'm going to go against Quo on this one, but I believe he's wrong. Apple glasses are aimed for March or June of 2021. Also, I've seen them. They're sleek as hell. will be showing you soon, end quote. As Apple Insider wrote, quote, both Quo and Processor have reliable track records on predicting Apple's product plans. Quo has a longer track record, but Processor has provided more details on imminent products accurately, end quote.

Starting point is 00:06:21 Remember the story from earlier about how Uber is in talks to acquire Grubhub slash seamless in an effort to consolidate the food delivery space? Well, Bloomberg points out, Uber's CEO, Dara Koswa Shahi, has priors for a playbook like this. Koswoshahi's previous job was as CEO of Expedia, where over the course of 10 years, he went on an acquisition spree that involved 41 transactions with a total value of $12.7 billion all in.

Starting point is 00:06:51 As Tom Giles tweeted, Kosovo Shahi cultivated his dealmaker reputation when he ran Expedia for more than a decade. His strategy, roll up competitors, integrate them, and reap the rewards of scale, end quote. Indeed, when the rumor of the acquisition talks broke, what was it that we heard? We heard that the economies of scale that could be unlocked from such a deal would basically pay for the deal.

Starting point is 00:07:15 Quoting Bloomberg, Expedia had already purchased hotwire and Hotels.com before Koswasahi took over, and then he accelerated the strategy. Them rolling up a category is not exactly new, said Stuart McDonald, who was Expedia's chief marketing officer at the time and is now a travel industry consultant. Dara turbocharged it, end quote. Kosro Shahi's 12-year tenure at Expedia was defined by an escalating battle with booking holdings. Each tried to outflank the other by buying upstart brands, splicing them into their tech ecosystems and squeezing out incremental profits.

Starting point is 00:07:48 Revenue at Expedia grew to $10.1 billion from $2.1 billion, and the company's share price rose nearly sevenfold while Kosra Shahi was in charge. When Kosra Shahi wants to get serious at the negotiating table, he has a tell. His hand goes behind his neck, his elbow slides across the desk, and he hones in on the subject with a calming timber. He leans into the numbers. He leans into the issues. He leans into you, said Rob Graber, who worked with Koswra Shahi at Expedia for about seven years managing the company's often fraught relationship with airlines. In a deal, when there can be a lot of emotion going on, he can snap out of all of that, which is a great asset.

Starting point is 00:08:28 unquote. So news you can use there, you grubhub negotiators you. Fresh off of yesterday's news that Chrome is adding the ability to group tabs together. There's further news for Chrome that beginning in August, the browser will also begin blocking ads that consume 8 megabytes of network data, 15 seconds of CPU usage in any 30-second period, or 60 seconds of total CPU usage overall. So essentially, Chrome, is going to start targeting resource-heavy ads. The stated target here would be ads that, you know, mine cryptocurrency or just poorly programmed. But as always with these sorts of things, it also might help boost Google's own ad revenue

Starting point is 00:09:16 at a time when that is sorely needed for Google. I won't harp on that for now, though, quoting Venture Beat, the threshold of 4 megabytes of network data, 15 seconds of CPU usage in any 30-second period, 60 seconds of total CPU usage represents just 0.3% of ads, Google said. And yet they account for 26% of network data used by ads and 28% of all ad CPU usage. Google's chart showed the overall percentage of heavy and non-heavy ads and the total resource usage of each.

Starting point is 00:09:47 Chrome will limit the resources a display ad can use before the user interacts with the ad. When an ad reaches one of the thresholds, the ads frame will navigate to an error page that simply says ad removed. Google wants to throw its weight around to cut down, those numbers, presumably it will then adjust the thresholds. The goal, quote, to save our users' batteries and data plans and provide them with a good experience on the web, end quote. What I will harp on for now

Starting point is 00:10:14 is something that I have said before. If someone out there really did want to go after Google on antitrust grounds, this is the sort of area that seems like it would be low-hanging fruit. by virtue of their browsing market share, by virtue of their own ads business, obviously being unaffected by any changes they bring to market because they have the resources to make that. So why is it fair that Google can essentially, simply by Fiat, decide which ads are served by advertisers who are not them, on websites, especially websites that they do not even control? In other words, how can they have this much power over the so-called. open web. You know, history can repeat itself. If Microsoft wasn't supposed to have the market-leading

Starting point is 00:11:00 web browser because it also had an underlying operating system monopoly, why is Google allowed to have the market-leading web browser when they also have one-half of an online advertising monopoly? Bloomberg has a piece up talking about what I've been telling you about, which is that seemingly everyone has been talking about, leaving Silicon Valley and other expensive tech hub city. as tech giants introduce potentially permanent work-from-home guidelines. Lots of people have been saying that they are considering moving away to somewhere cheaper. A typical quote is like this one from the piece. Sachin Dar thought he and his fiancé had a great deal paying $2,650 a month for a one-bedroom rental in South San Francisco, a short commute from Facebook's offices in Menlo Park, where she works.

Starting point is 00:11:54 But when the social networking company announced that most employees would be working from home until the end of the year, their calculation changed. It makes no sense paying Bay Area rent if we can earn our salary living elsewhere, says Dar, 25, who already works remotely for a New York advertising startup. They're considering moving to Hawaii or to save real money somewhere in the rural U.S., end quote. But as this piece points out, if you do move to, say, Lake Tahoe or Des Moines for a lower cost of living, you know that your employer knows what you're up to, right? Why wouldn't your employer also take the same cost of living calculations into account. Quoting from the piece again, if employees move to a less expensive location, should Twilio adjust their salaries accordingly? It's probably not great

Starting point is 00:12:40 business practice to pay Bay Area comps in Michigan, Lake of Twilio says. And when it comes time to promote, would those employees have the same opportunity to advance as everyone else? Quote, we need to think proactively, Twilio's Lake says, end quote. Here's the other thing. There's sort of a confirmation bias going on here. I mean, I'll use myself as an example. Everyone I know works in tech. A lot of them are my age. A lot of them already have a family, have kids, and they crucially already have salaries and positions at tech companies. My point is this. Take it from someone who has lived in New York City now for two decades. One day, you are the hungry young person looking to break into an industry. But the next day, before you know it,

Starting point is 00:13:26 you're the person with the comfortable job, with the privilege of weighing your options. That doesn't mean that there isn't a whole new wave of hungry young people out there eager to pounce on the opportunities that you no longer need to avail yourself of. Point is, as long as the opportunities remain clustered in specific places, there will always be people willing to go where the opportunities are. So long as the companies and startups themselves are in a certain place, that's where the opportunities will be, and that's where the young hungry people will go. Time for the weekend long read suggestions.

Starting point is 00:14:04 I've also been seeing this over and over again, but haven't had the chance to talk about it till now. You want to know one of the biggest success stories of the coronavirus moment? It's a site slash service called OnlyFans. Imagine OnlyFans as a sort of hybrid between Instagram, mixed with Patreon, where fans of adult performers and sex workers can interact virtually with their idols, with all that implies, actually. Well, guess what?

Starting point is 00:14:35 Only fans saw a major increase in sign-ups to their service with as many as 150,000 new sign-ups a day last month. And it's a supply thing as much as it's a demand thing, since sex workers are seeing digital sex work as being suddenly more viable in a virtual way ever since the pandemic hit. Only Fans was launched in 2016, just as adult entertainers and sex workers were being shut out of platforms like Instagram, Patreon, and Tumblr, thanks largely to the passage of Fasta Sesta Bills. OnlyFans' loose content restrictions allow creators to put racy, queued images, and videos behind paywalls, and engage with monthly subscribers through custom videos, DMs, and exclusive pay-per-view shows. Frequent payouts, and OnlyFans comparably low 20% cut, most camsites take 40% percent. percent or higher, makes the site incredibly popular. Circumventing the use of old-fashioned narrative

Starting point is 00:15:32 pornography studios has also been a boon to creators who are grateful for the sites bolstered security and anti-privacy measures. Quote, OnlyFans is the wave of the future because it is so much harder to steal the content, wrote Rain DeGray, a former in real life sex worker and writer who has earned in the top 11% on OnlyFans for the last two years. DeGray told me via DM that thanks to rampant piracy and the proliferation of tube sites uploading stolen pay porn, getting people to pay became impossible, quote, with the industry a shell of itself and now the pandemic on top of its studios are just not creating like they used to. But only fans, she says, is the farmer's market of porn. The creator is selling directly to the consumer, end quote. And here's another

Starting point is 00:16:17 company that's been chased online by the pandemic. Sporkel has been running trivia nights at bars for several years now. And now, overnight, they've built a two and a half million business by taking those trivia contests to Zoom. Quote, when COVID-19 spread, two things happened. Sporkel's live events business ground to a halt overnight, and its web traffic exploded. In April, consumers played an average of 1.83 million quizzes on its site each day, compared with 1.24 million per day in February. That's how founder Ali Adar and his team got the idea to experiment with,

Starting point is 00:16:53 hosting trivia games on Zoom, which has become everyone's favorite quarantine video conferencing app. Sporkel ran a few trials at the end of March, quickly built a companion scoring app, and officially rolled out the new service on its website in the first week of April. The response was nearly instantaneous. In just a few weeks, Sporkel hosted more than a thousand virtual trivia nights. We realize we had a hit on our hands, Adar said. The company is now hosting hundreds of virtual trivia nights on Zoom every week with participants paying $5 per device they use to join the game. Each single game can be attended by up to nine teams, and each team can have up to 10 participants on individual devices, end quote.

Starting point is 00:17:32 Ali Adar is one of the founding engineers of Napster, so I've been trying to get him on the internet history podcast for years. But someone else I've wanted to interview for that same show for years is Lewis Borders. Back in the dot-com bubble, web van was the most notorious flameout to the tune of $1 billion in investment capital burned to the ground. Webvan did online grocery ordering and delivery, which, as we now know, was not as insane an idea as it seemed back in 1999. And it turns out that Borders has never quite given up on the idea, quoting from Forbes. Borders has raised $30 million from investors funding his ambitious dream of beating Amazon, Walmart, and others in the suddenly critical business of delivering groceries to American homes. This time, he says he can leverage

Starting point is 00:18:20 strides made in artificial intelligence and robotics to operate highly automated warehouses, which will allow him to beat the giants of the business, including Amazon and Walmart, end quote. If the border's name sounds familiar to you, that's because, yes, Lewis was the founder of the border's book chain 50 years ago now. In the mid-90s, his became one of the first companies to be Amazoned, to be a casualty of the digital era. I'd love to talk to him for like two hours about a whole bunch of stuff.

Starting point is 00:18:50 And this is something that I will be watching closely over the next few weeks. HBO Max is launching on May 27th. This is the whole AT&T slash Warner play. This is the John Stanky playwright, as we've talked about. HBO Max once seemed like it was going to be late to the game, but now in the Corona moment, maybe not so much. They are still the most expensive streaming play out there, though, in terms of the monthly subscription price.

Starting point is 00:19:18 And yet a ton of people are already paying, for HBO, so for some, it won't cost really anything extra at all. Variety has a summation of the state of play here. It's a huge $4 billion bet for AT&T, and this is the company, remember, with the largest debt load in the world. And then there's the fact that 30 original projects that HBO Max had hoped would drive subscribers to the new service have had to shut down production because of coronavirus. Quote, the hope is that HBO Max is built up over the next few years to be a multi-purpose platform for global distribution of Warner Media content, as well as an engine for building subscriptions to AT&T's wireless and data services. The fear is that an underwhelming HBO

Starting point is 00:20:02 Max would tarnish, or worse, be a financial strain on HBO proper. The pay TV pioneer generated operating income of $2.3 billion from revenue of $6.8 billion in 2019, end quote. Wired has a profile of Marcus Hutchins, who at 22 years old, single-handed put a stop to the worst cyber attack the world has ever seen, and then he was arrested by the FBI. I actually haven't read this one yet, but people have been tweeting about it all week saying it's pretty insane. The MIT Technology Review says that all of our weird behavior recently during the pandemic has been messing with machine learning AI models, quote, machine learning models trained on normal human behavior are now finding that normal has changed,

Starting point is 00:20:47 and some are no longer working as they should. How bad the situation is depends on whom you talk to. According to Pactra Edge, a global AI consultancy, automation is in a tailspin. Others say they are keeping a cautious eye on automated systems that are just about holding up, stepping in here or there with manual corrections when needed. What's clear is that the pandemic has revealed how intertwined our lives are with AI, exposing a delicate codependence in which changes to our behavior change how AI works and changes to how AI works change our behavior.

Starting point is 00:21:22 This is also a reminder that human involvement in automated processes and systems remains key. You can never set and forget when you're in such extraordinary circumstances, says Klein, end quote. And finally, the conversation says that, yes, websites really are starting to look all the same again. This is a design problem that seems to come up every few years or so. it comes in waves, and to be quite honest, I have noticed it recently myself, quoting from the piece. We found that across all three metrics being color, layout, and AI-generated attributes, the average differences between websites peaked between 2008 and 2010 and then decreased between 2010 and 2016. Layout differences decreased the most declining over 30% in that time frame.

Starting point is 00:22:12 This is a visual piece, though it's a short one, but click through, designers if you want to see exactly what they're talking about. So as of right now, no one has posted any questions to the subreddit yet, which that's perfectly fine. I was just hoping someone would put some questions in there so I knew what we would be talking about. But we can still go ahead and do this anyway, because I can just call on you live if you join the Zoom call and we can chat about whatever. Again, the Zoom call will take place. Saturday, one, p.m. Eastern time. Worst case scenario, a bunch of us just get on there and shoot the breeze for a while. But if the questions and conversation are interesting enough, my intention is to put this up as a bonus

Starting point is 00:23:02 episode. And the Zoom link is in the show notes, if I can not forget to do that. But otherwise, that's it. Are you guys aware that football is back this weekend? It is Bundesliga, which I'm not the biggest fan of in the world. But hey, 930, tomorrow. morning, Barushia Dortmund versus Chalka. I know I'll be watching because imagine that. An event that's live that you won't know the result of ahead of time. What a crazy world we live in. And also, we do have a classified ad sent in by a fellow listener that wants you to know about a cool project that they're working on. So listen to that right now. Talk to you on Saturday if you join the Zoom call or else on Monday as per usual. Do you have a teenager in the household feeling anxious

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Tech Brew Ride Home - Fri. 05/15 – Facebook Buys GIPHY

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