Tech Brew Ride Home - Wed. 08/14 - “We” Files, a MacBook Pro “No Fly List” and “Boatbnb”

Episode Date: August 14, 2019

WeWork files for its IPO, a huge data leak reveals fingerprints, facial recognition data and more, are you going to have trouble taking your MacBook Pro on your next flight, why Two and a Half Men is the next big piece in the streaming wars and why I’m bullish on an Airbnb for boats. Sponsors: Metalab.co MacStadium.com/ridehome Links: WeWork files for long-awaited IPO (Axios) Major breach found in biometrics system used by banks, UK police and defence firms (The Guardian) FAA Bans Recalled MacBook Pros From Flights (Bloomberg) AI Startup Boom Raises Questions of Exaggerated Tech Savvy (WSJ) HBO Max eyeing ‘Big Bang Theory’ and ‘Two and a Half Men’ in $1.5 billion deal (The Daily Dot) Facebook Paid Contractors to Transcribe Users’ Audio Chats (Bloomberg) Peer-to-peer boat rental marketplace Boatsetter raises $10M as it looks to grow globally (TechCrunch) Subscribe to the ad-free feed right HERE in your podcast browser! 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 TechMeme ride home for Wednesday, August 14th, 2019. I'm Brian McCullough today. WeWork files for its IPO.

A huge data leak reveals fingerprints, facial recognition data, and more. Are you going to have trouble taking your MacBook Pro on your next airplane flight? Why 2.5 men is the next big piece in the streaming wars. And why I'm bullish on an Airbnb for boats. Here's what you miss today in the world of tech. WeWork has officially filed to raise one. billion in an IPO expected to come in September. Now, don't at me. I know that technically the company is now known as we. But look, let's just all agree that we're going to keep calling

it WeWork for the purposes of this not sounding silly. The filing allowed people to finally delve into WeWork's finances. And folks found a company reporting $1.5 billion in revenue for the first half of 2019, but with a net loss of $904 million. More details, revenue and operating losses move in tandem, as many had surmised. Both revenue and operating losses doubled year over year. The company has 527,000, what it calls members, up from 268,000 at the end of June 2018. It has 528 locations in 29 countries. We work has cash on hand of $2.47 billion, which would mean, with those losses, raising merely a billion dollars in an IPO doesn't buy the company much runway, right? Well, don't worry, because WeWork also

intends to secure a $6 billion credit facility to go along with the IPO. As always with WeWork, the filing set off a sort of Super Bowl Sunday of Snark. No, it turns out, In the filing, there was no mention of the much ridiculed, quote, community-adjusted EBITDA, that sort of alternative accounting measure wherein we work tried to put things like rent and tenancy expenses, utilities, internet, salaries of the building staff, and the like, into a nice little corner to try to keep those pesky expenses off the bottom line. It seems the SEC didn't go for that sort of thing. But in the prospectus summary,

WeWork did introduce itself this way, quote, We are a community company committed to maximum global impact. Our mission is to elevate the world's consciousness, end quote. And the second page of the filing says this, quote, We dedicate this to the energy of we, greater than any one of us, but inside each of us, end quote. Which, to be fair. fair is a hard thing to measure if you're going to use Gap as a yardstick.

And this is also worth noting, quoting Dan Premack, CEO Adam Newman, may be one of just three co-founders, but he controls the shares and the votes. He also didn't take a salary last year and agreed to lock up his shares for a year after the offering. Newman also pledges, along with his wife, Rebecca, to donate at least $1 billion to charitable causes by the IPO's 10-year anniversary. If it doesn't happen, his voting rights get slashed, end quote. In other words, if in 10 years the Newman's haven't donated $1 billion to charity, they lose half of their voting rights. Again, there's a metric ton of snark and analysis online about all of this at the moment. But to sum it up in a nice little bow, again, Dan Primack,

quote, we work will be the most polarizing IPO of 2019, and that's saying something in a year that already saw Uber and Lyft, end quote. Another day, another data breach. But, you know, I feel like they're almost helpfully coming up with new twists on this just to keep it interesting. In a way, this is maybe the craziest breach I've ever heard of, given what was exposed. fingerprints, facial scans, and other biometric data, also usernames, passwords, and personal information for more than a million people, all from a system that is used by banks, the London police, and defense contractors, was discovered on a publicly accessible database. Suprema is a security company that operates the web-based Biostar-2 Biometrics lock system.

Biostar 2 uses fingerprints and facial recognition as a way of identifying people attempting to gain access to buildings. Quoting the Guardian The Israeli security researchers Nome Rodham and Ranlocar, working with VPN Mentor, a service that reviews virtual private network services, have been running a side project to scan ports looking for familiar IP blocks and then use these blocks to find holes in companies' systems that could potentially lead to data breaches. In a search last week, researchers found Biosar 2's database was unprotected and mostly unencrypted. They were able to

search the database by manipulating the URL search criteria and elastic search to gain access to data. The researchers had access to over 27.8 million records and 23 gigabytes worth of data, including admin panels, dashboards, fingerprint data, facial recognition data, face photos of users, unencrypted usernames and passwords, logs of facility access, security levels, and clearance, and personal details of staff. Much of the usernames and passwords were not encrypted, Rodham told the Guardian. We were able to find plain text passwords of administrator accounts, he said, end quote.

Which would, in theory, allow anyone to edit an existing user's account, add their own fingerprints, and access any building that used the Biostar 2 system. So number one, super. That would be some really useful spycraft if you were in the the spy game. And number two, again, I love how security companies seem to often be the laziest anywhere when it comes to operational security. And three, again, this is sci-fi stuff. Once we digitize things like this, scans of our faces, our fingerprints, eventually our voices, our DNA, all that. Eventually, all that stuff could be used either to impersonate you or me

or, I guess, potentially, erase us, right? As Michael Madden tweeted, quote, If you are an affected customer, please change your password, fingerprints, and face immediately, end quote. This is me hoping that this is not a thing and hoping I'm just being alarmist. But the FAA has sent airlines a reminder to follow 2016 safety instructions that ban goods with recalled batteries and specifically said it was, quote, aware of the recalled batteries that are used in some Apple MacBook Pro laptops, end quote. The laptops in question are some 15-inch MacBook Pros sold between September 2015 and February 2017. You might recall that Apple issued a recall of those laptops in June, quoting Bloomberg.

The watchdog also reminded airlines to follow 2016 safety instructions for goods with recalled batteries, which means that the affected Apple laptops should not be taken on flights as cargo or in carry-on baggage by passengers. The European Union Aviation Safety Agency issued a warning about these MacBook Pro models earlier this month, telling airlines in the region to follow 2017 rules that require devices with recalled lithium ion batteries to be switched off and not used during flights, end quote. So here's the thing that has me nervous. Does this mean TSA and flight attendants will be checking the serial number, on any Apple laptops? Because otherwise, how could they feasibly keep these laptops off of flights? I checked the serial number on my MacBook Pro, and it said it wasn't part of the recall.

But yeah, can you imagine the security screening snafu or hell that MacBook Pro owners might be in for if this is strictly enforced? and we have to check serial numbers against a list just to get through security. The Wall Street Journal is claiming that sources have told it that engineer.a.i, a softbank-backed startup that claims to offer human-assisted AI to automate app development, does not, in fact, use AI and relies instead largely on human engineers in India. Now, I have heard rumors about things like this with other stuff. startups, especially in the bot space, startups that claim an automated bot will interact with customers or deliver answers to folks independently when in reality the majority of the heavy

lifting is done by humans working off of intricate decision trees. But as the journal notes, the competing claims reflect a growing challenge in the tech world of assessing a company's proficiency in artificial intelligence, which refers to technologies that can allow computers to learn or perform tasks, typically requiring human decision makers, in many cases helping companies save money or better targeting consumers. Because AI technology is complex and loosely defined, non-experts can find it hard to discern when it is being deployed. Still, money is flowing into the sector and many startups can say they use AI as a way to lure investments or corporate clients, even when such claims are difficult to vet, end quote. See, this is a more finely

grained question than you might have thought. Number one, to what degree is AI really AI, and to what degree is a lot of AI still, really just human-assisted busy work? And also, this kind of has shades of the let's fake it until technology catches up and allows us to make it philosophy. I'm thinking of you ride-hailing companies. Quoting again, in a previously unreported lawsuit, Engineer AI's former chief business officer, Robert Holbeheim, cast doubt on the company's technical prowess. to his wrongful termination complaint filed in February in Los Angeles Superior Court. Mr. Dugel told Mr. Hahnheim, quote, every tech startup exaggerates to get funding. It's the money that allows us to develop the technology, end quote.

Mr. Holtheim added in the complaint that Mr. Dugel, quote, was telling investors that engineer.a.I was 80% done with developing a product that, in truth, he had barely even begun to develop, end quote. Mr. Holthheim declined a comment on the suit, which claims he was dismissed after confronting Mr. Dougal about potential misuse of investor funds, among other alleged issues, end quote. The phase of the streaming wars that we are entering is the consolidation phase. And by that I mean, anyone that is going to launch a streaming service is right now in the midst of balking up with the best IP that they can find to try to make themselves attractive as a consumer option. So not that this wasn't already the state of affairs in Hollywood, but if you own some recognizable IP, well, get ready to back up the Brinks truck. The Daily Dot is reporting that the forthcoming HBO Max quote, is circling a purchase of the Big Bang Theory and two and a half men for a combined $1.5 billion.

Deadline reports that a deal is approaching as the company looks to solidify its streaming library ahead of its upcoming launch. The two Chuck Lurie produced multicam sitcoms proved massive hits during their original runs on CBS and have already been a force in cable syndication. Logic dictates that they should be massively popular as streaming properties as well. This marks the second huge deal for HBO Max in recent months as the service already paid $425 million for friends, which has long been a Netflix centerpiece, end quote. Again, anything that did or would do well in syndication is just going to. to be very much in demand as the streaming services launch because they're just replacing TV, right? Your idle boob tube watching hours. The office is already spoken for at NBCU and Disney locked down The Simpsons and Family Guy by acquiring Fox.

So one more big name that is still out there, the Holy Grail that people say might be in for an insane bidding war in the near future. Seinfeld. I said that all voice assistants do this, but this is a slightly different story. Bloomberg has been reporting that Facebook paid hundreds of contractors to transcribe user audio. But wait, Facebook doesn't have a voice assistant, right? Quoting Bloomberg, Facebook confirmed that it had been transcribing users audio and said it will no longer do so, following scrutiny into other companies. quote, much like Apple and Google, we paused human review of audio more than a week ago, the company said Tuesday. The company said the users who were affected chose the option in Facebook's Messenger app to have their voice chats transcribed. The contractors were checking whether Facebook's artificial intelligence correctly interpreted the messages, which were anonymized, end quote.

So, yeah, this is crossing into a completely new sort of territory now. Now, this is essentially, if you squint a little bit, listening in on and transcribing what are essentially personal calls. I'll just leave this here, quoting again from Bloomberg. Facebook has, quote, long denied that it collects audio from users to inform ads or help determine what people see in their news feeds. Chief Executive Officer Mark Zuckerberg denied the idea directly in congressional testimony. Quote, you're talking about this conspiracy theory that gets passed around that we listen to what's going on on your microphone. and use that for ads, Zuckerberg told U.S. Senator Gary Peters in April 2018, quote, we don't do that, end quote. In follow-up answers for Congress, the company said it, quote, only accesses user's microphone if the user has given our app permission and if they are actively using a specific feature that requires audio like voice messaging features, end quote.

The Menlo Park, California-based company doesn't address what happens to the audio afterward, end quote. So I actually believe Facebook was just doing this to improve the AI or transcriptions or translations or whatever. I actually believe that with all of these cases, that's just the nature of voice recognition tech at the moment. You need humans to check the work of the bots. But again, this is another case of companies doing whatever they want without telling people and then quitting as soon as the stuff comes to light. We're in this weird sort of limbo where nobody wants humans. listening in on what they're saying, and yet the robots aren't quite good enough yet to listen in to what we're saying on their own. But stop and think about that for a second. If the robots

do get better at this and we can fire all of the human transcribers and listeners in, are we assuming that that's somehow better? Because once surveillance is automated, it's actionable data at scale at that point. Right now, it's just some poor contractor transcribing my inane chats for peanuts an hour. And frankly, that feels safer to me somehow. Finally, today, boat setter is a peer-to-peer boat rental marketplace that has raised a $10 million series A extension, bringing the total that the startup has raised lifetime to $31 million. Why do I find this interesting. As the TechCrunch article that I'm about to quote from points out, not everyone owns a boat. Boats aren't cars or houses. And that's kind of the point.

Who even wants to own a boat with the expense and the hassle of maintenance and stuff? So maybe boats are actually kind of the ideal sort of product for an on-demand peer-to-peer rental scenario. Quote, Boat Setter counts itself the top peer-to-peer boat rental marketplace in the U.S. and offers insurance to boat renters, owners, and captains alike through a just-announced strategic partnership with GEICO. The Miami-based startup estimates the size of the peer-to-peer boat rental market at as much as $50 billion annually and plans to use its investment to expand its offering, both from a product perspective and expanding its presence in key markets globally.

The company focuses on rentals for anywhere from two to more than a dozen passengers and a range of boat options that can also include qualified captains for larger vessels. It's a bit like an Airbnb crossed with an Uber, and there are rentals available in vacation hotspots around the world, end quote. So see, when you look at it that way, it makes a ton of sense. The amount of times I would want a boat in my life are probably few and far between. But when I do want one, that magical vacation some years in the future, wouldn't it be nice to have an Airbnb option for boats?

That's all for today. is I'm Brian McCullough. Follow me on Twitter at Brian MCC. The show subreddit is our slash ride home. Tip me stories there and debate the news with fellow listeners. The bottom link in the show notes is to the ad-free feed. The ad-free version of the show that lets you support the show directly. And if you'd like me to read a podcast classified ad for you or your project, hit up ridehome.com. slash classifieds. Talk to you tomorrow.