Tech Brew Ride Home - Mon. 05/13 – The Solar Storm Is Real (Ask Farmers)

Episode Date: May 13, 2024

Well, looks like my worries about solar weather being a threat to technology wasn’t just in my head. Ask farmers. Squarespace to go private. Raspberry Pi to go public? Waymo is setting some impressive records. And the new type of deal Apple and the other streamers want to offer Hollywood. Sponsors: ArcticWolf.com/techmeme Shopify.com/ride Links: Solar Storm Knocks Out Farmers' Tractor GPS Systems During Peak Planting Season (404Media) Website-design firm Squarespace to go private in $6.9 billion deal with Permira (Reuters) British tech firm Raspberry Pi lines up £500m float (The Times) Microsoft set to face EU competition charges over Teams software (Financial Times) Google’s Waymo Crosses 50,000 Paid Driverless Rides Per Week (The Information) Apple Nears Deal With OpenAI to Put ChatGPT on iPhone (Bloomberg) Apple, Netflix Amazon Want to Change How They Pay Hollywood Stars (Bloomberg) 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 Monday, May 13th, 2024. I'm Brian McCullough today. Well, it looks like my worries about solar weather being a threat to technology wasn't just in my head. Ask farmers. Squarespace to go private, Raspberry Pi to go public, question mark. Waymo is setting some impressive records and the new type of deal Apple and the other streamers want to offer Hollywood. Here's what you miss today in the world of tech. Did you enjoy the Northern Lights show we got this weekend? I'll tell you who did not. farmers. And I'm leading with this because we've done long reads about this very thing happening for several years now. Is one of the biggest black swan dangers out there, a bad solar storm that

could knock out anything electronic? Well, small taste of how that could happen, as U.S. farmers have had to halt their planting operations after the solar storm broke critical GPS and precision farming functionality in tractors and other equipment. Quoting 404 media, one chain of John Deer dealerships warned farmers that the accuracy of some of the systems used by tractors are extremely compromised in their words, and that farmers who planted crops during periods of inaccuracy are going to face problems when they go to harvest, according to text messages obtained by 404 media, and an update posted by the dealership. The outages highlight how vulnerable modern tractors are to satellite disruptions, which experts have been warning about for years.

All the tractors are sitting at the ends of the field right now shut down because of the Solar Storm. Kevin Kenny, a farmer in Nebraska, told me, no GPS. We're right in the middle of corn planting. I'll bet the commodity market spike Monday, end quote. Specifically, some GPS systems were temporarily knocked offline. This caused intermittent connections and accuracy problems with real-time comatic or RTK systems, which connect to John Deere Starfire receivers that are in modern tractors and agricultural equipment. RTC systems use GPS plus a stream of constantly updating correction data from a fixed point on the ground to achieve centimeter-level positional accuracy for planting crops, tilling fields, spraying fertilizer, and herbicides, etc.

According to updates from Landmark Implement, which owns John Deere dealerships in Kansas and Nebraska, the solar storm ruined the accuracy of RTK systems for many farmers using John Deer tractors. Similar systems and other brands of tractors have also been compromised, the dealer and farmers I spoke to said. These automated systems have become critical to modern farming, often called precision agriculture with farmers using increasingly automated tractors to plant crops in perfectly straight lines with uniform spacing. Precision agriculture has greatly increased the yield of farms, and a 2023 report by the U.S. Department of Agriculture noted that more than 50 percent of corn,

cotton, rice, sorghum, soybeans, and winter wheat are planted and harvested with automatic guidance. Many modern tractors essentially steer themselves with the oversight of a farmer in the cab. If the planting or harvesting is even slightly off, the tractors or harvesters could damage crops or plant crooked or inconsistently, which can cause problems during the growing season, ultimately reduce yield. Landmark implement first warned farmers about the problems Friday in a text message blast obtained by 404 media. Please be advised that there is a significant solar flare and space weather activity currently affecting GPS and RTK networks. This severe geomagnetic storm is the worst since 2005 and is forecasted to continue throughout the weekend. That message advised farmers

to shut down their reliance on the networks entirely. The National Oceanic and Atmospheric Administration said that what's happening is the, quote, most extreme geomagnetic storm since 2003, and that there have been preliminary reports of power grid irregularities, degradation to high-frequency communications, GPS, and possibly satellite navigation, end quote. Noah said the storm will continue into Monday. Geomagnetic storms happen when there is a coronal mass ejection from the sun, which is an eruption of electromagnetic radiation that can impact GPS, the electric grid,

and other communications. Farmers and experts I spoke to told me that GPS outages in farming are a very big deal. Landmark implement has not given any further updates to farmers, and John Deere did not respond to a request for comment. Farmers I spoke to seem to think that the situation is getting better, but solar storms are expected to continue hitting Earth over the next day or so. In the Corn Belt, May 15th is a critical date to get corn planted. Willie Cade of Repair. org, who has been working to pass legislation that would make tractors more repairable, told me. But you don't want to go out there with your equipment right now. Oh my God, the corn belt can't get its corn in the ground by May 15th. That's huge. I'm thinking it's going to go away.

But if it doesn't, shit, end quote. A couple of liquidity event stories for you right now. Squarespace says private equity firm Permira plans to take the company private in a $6.9 billion all-cash deal or $44 per share, a 15.2% premium on Friday's close. Quoting Reuters. The deal which comes less than three years after Squarespace went public underscores the growing interest of private equity firms in tech companies that help businesses digitize their operations and enhance branding and reach. Squarespace and its rivals Wix, WordPress, and Shopify are among the companies that helped businesses go online to sustain sales

after the COVID-19 pandemic. Squarespace was valued at $6.5 billion in its market debut in May 2021. Upon going private, the company said it would have the flexibility and resources to invest in enabling entrepreneurs to build better online brands and more easily transact with their customers. Founder and CEO, Anthony Casalena, who will continue as CEO and board chair, will roll over a substantial majority of his existing stake and continue to be one of the largest shareholders after the deal. The transaction is expected to close by the fourth quarter of 2024 and long-term investors, Acel and General Atlantic, have agreed to reinvest and vote in favor of the deal, the company said. end quote. And is the company behind the Raspberry Pi about to go public? Quoting the register. A write-up in the Sunday Times over the weekend cited unnamed city sources as suggesting that a 500 million pound or $627 million flotation could happen within the next two weeks, although it might be delayed if market conditions deteriorate. Raspberry Pi Limited appointed bankers

Peel Hunt and Jeffries ahead of an initial public offering in January 2021. CEO Evan Upton told the register, we want to be ready when the markets are ready. The business is in a much better place than it was last time we looked at it. We partially stopped because the markets got bad. Then we partly stopped because our business became unpredictable, end quote. Today, Upton did not immediately respond to a request for comment regarding the latest flotation rumors. In terms of valuation, 500 million pounds seems reasonable. In 2023, Arm Holdings acquired a minority stake in the company,

which valued it at 400 million pounds or 500 million dollars, in accounts filed at UK Company's House for the year ending December 31, 2022, Raspberry Pi Limited reported revenues of $188 million or $236 million in increase of 34% from the previous year. In 2021, rumors of a flotation that would have valued the company at approximately $300 million or $376 million were dismissed by Upton. However, he told the register, we speak to advisors all the time about how we might fund the future growth of the business. The Raspberry Pi is a series of single-board computers initially aimed at

education users, but later adopted for industrial purposes. Most of the devices use a Linux operating system, although Windows 10 IoT core was released for the Raspberry 2 and 3 by Microsoft, enterprising enthusiasts have also managed to coax Windows 11 into life on the platform, end quote. Sources are telling the Financial Times that the EU is set to issue new antitrust charges against Microsoft over concerns surrounding undermining teams competitors, despite Microsoft offering concessions. quote, according to three people with knowledge of the move, the European Commission is pressing ahead with a formal charge sheet against the world's most valuable listed tech company over concerns. It is restricting competition in the sector. Microsoft last month offered concessions as it sought to avoid regulatory action, including extending a plan to unbundled teams from other software such as office, not just in Europe, but across the world. However, people familiar with their thinking said EU officials are still concerned that the company did not go far enough to facilitate fairness in the market. Rivals are concerned that Microsoft will make teams run more compatibly than rival apps with its own software. Another concern is the lack of data portability, which makes it difficult for existing

teams users to switch to alternatives. The Commission's move would represent an escalation of a case that dates back to 2020 after Slack, now owned by Salesforce, submitted a formal complaint over Microsoft's teams. It also would end a decade-long truce between EU regulators and the U.S. tech company after a series of competition probes that ended in 2013. The EU then issued a $561 million fine against Microsoft for failure to comply with a decision over the bundling of the Internet Explorer browser within its Windows operating system. Charges could come in the next few weeks, said the people familiar with the Commission's thinking. Rivals of Microsoft and the Commission are meeting this week to discuss the case in an indication that the charges

are being prepared, the people said. However, they warned that Microsoft could still offer last-minute concessions that would derail the EU's case, or the Commission might decide to delay or scrap the charges against the company. Microsoft risks fines up to 10% of its global annual turnover if found to have breached the EU competition law, end quote. Tangible signs of progress, backed up by some tangible numbers here. Waymo says it's Waymo 1. Robotaxies now complete over 50,000 paid trips every week across San Francisco, Phoenix, and Los Angeles, up from 10,000 rides in all of May, 2023, quoting the information. Waymo 1, which now operates in San Francisco, Phoenix and Los Angeles has received approval in other cities on the West Coast and is planning

to expand to Austin. It expects to grow rapidly to 10 times last year's numbers by the second half of 2024, it said. Waymo has raised $5.5 billion in funding from external investors as well as Alphabet and was once valued at $30 billion, according to data from Pitchbook. The growth in the paid service, Waymo 1 should help the 15-year-old project reduce the heavy cash burn. That's raised the ire of Alphabet investors. It also extends its lead over rivals such as General Motors Cruz and Tesla, whose CEO Elon Musk has said will reveal a robotaxie this summer, end quote. Just confirming something that will probably be a big deal next month, Mark Gurman sources say Apple is finalizing a deal with OpenAI to use chat GPT features in iOS 18. Talks with Google to license

Gemini are still ongoing. Quote, an OpenAI accord would let Apple offer a popular chatbot as part of a flurry of new AI features that it's planning to announce next month. Bloomberg reported in April that the discussions with OpenAI had intensified. Still, there's no guarantee that an agreement will be announced imminently. The two sides have been finalizing terms for a pact to use chat GPT features in Apple's iOS 18, the next iPhone operating system, said the people who asked not to be identified because the situation is private. Apple also has held talks with Alphabet's Google about licensing that company's Gemini chatbot. Those discussions haven't led to an agreement, but are ongoing, end quote. Finally, today, sources are telling Lucas Shaw that Apple has met

with Hollywood talent representatives to propose a new performance-based compensation regime, something that Amazon and Netflix are apparently pushing as well. Quoting Bloomberg, After years of compensating people as though all their projects were successful, Apple will soon begin basing pay on how a series or movie performs. Apple has already met with talent representatives to propose a new performance-based compensation regime, according to a memo that we've seen and conversations with several people involved. Talent would receive bonuses based on a point system. The size of the bonuses will be

based on three criteria. The number of people who sign up for Apple TV Plus to watch, how much time they spent viewing and the cost of the program relative to the size of its audience. People with one of the top three shows could share up to $10.5 million for a season. This plan isn't final. Apple has asked people for feedback. It also doesn't apply to every show on Apple, just those the company produces in-house. But the tech giant, along with Amazon, Amazon and Netflix is in the early stages of an experiment that will make the streaming business look a little bit more like the Hollywood of York. Netflix and Amazon have both spent months developing new plans for performance-based compensation, though neither one has gone public with

the model just yet. Amazon still needs to pick the most relevant data point, like what percentage of a show's viewers finish it, and both companies need to determine how they will pay people. They aim to try out the new models in the coming months. Streaming services are changing the system to better align pay with performance, something many people in Hollywood say they want. Producer Jason Bloom and United Talent Agency Chief Jeremy Zimmer have both made similar arguments. When you get a flat $10 million, whether your show is good or bad, you have less incentive to do it well. Many top producers and talent representatives are skeptical.

They believe these companies are just trying to save money. These latest proposals still don't offer real ownership or a share of profit. Apple and Disney are both offering bonuses. But Zimmer and others still see progress. The good news is everyone is thinking about it and talking about it. told me Friday, media companies do need to bring the cost of production down, and they can do so by reducing their upfront payments. In order to get talent to buy into such a change, they need a carrot of a bigger payday down the line. The current system began, as with so much in Hollywood these

days, with Netflix. Netflix offered lots of money up front, treating every show as a modest hit because it was the new kid in town. It needed to offer bigger sums to win projects. It could guarantee a season or two and pay well over the cost of a show. Everyone loved the net. Netflix way at first. Writers got paid even when a show they created was unpopular. Producers and big stars received so much money up front that they felt like they were making more money than ever before. Netflix transformed into the most powerful TV network in the world and every other major company had to follow along or risk losing their best writers. Yet in recent years, many people in Hollywood have begun to think these deals aren't always in their best interest.

The average worker felt like they were doing more work for less money, which is a big reason for the two strikes of last year. Writers and actors secured more viewership data and higher pay, but they didn't alter the fundamentals. TV producers, writers, and stars aren't thrilled either. They used to earn generational wealth. They were paid every time an episode was rerun and every time a show was licensed to another TV network in the U.S. or abroad. There are writers who still earn tens of millions of dollars a year for shows that no longer air new episodes. Yet today at Netflix, you can create the most popular show of the year and get paid like it was just a modest hit. Now the stars and producers have hit shows like Stranger Things and Wednesday can still make pots of money.

when they renegotiate their deals for new seasons. As media companies seek to rain in costs and boost profit, they too have begun to question the system, which they worry leads to excess. When waste doesn't hurt a producer's take-home pay, there is little incentive to bring in a show under budget, end quote. Okay, so I'm aware there is an Open AI event planned for early this afternoon, but I decided not to hold the show till later to cover that, since it doesn't look like they're going to announce GPT5, at least today. So I'll let you have. know what they actually do announce tomorrow and also tomorrow in the early afternoon is Google I.O. Now, in the past, I would have held the show till later to try to cover that, but I.O. is tough

because Google announces so many things. So I'm going to gamble again and cover I.O. on Wednesday's show once we have a better sense of what the most important headlines were. Both of these decisions to not hold the show till later, but cover the next day. Could blow up in my face, but we will see. If the Google News is big enough, I might just make all of Wednesday's show about that and release it earlier Wednesday morning, as I'll be able to write the show the previous night. You don't care about any of this, do you? It's inside baseball, it's how the sausage is made, it's in the weeds, whatever. Just thought I'd let you know my thinking for why I'm not doing late shows today and tomorrow, at least as of right now. Talk to you tomorrow.