Tech Brew Ride Home - Wed. 10/05 – Elon Wants Twitter Now. We Think. Who KNOWS ANYMORE!!??

Episode Date: October 5, 2022

Yes, we’ll get into the whole Twitter/Elon thing. Seems he wants the original deal again… or does he? Tesla is removing more sensors from their cars. The hugely problematic launch of Overwatch 2. And the tech angle to that whole Chess cheating scandal. Links: Musk Revives $44 Billion Twitter Bid, Aiming to Avoid Trial (Bloomberg) Elon Musk says Twitter will eventually be part of ‘X, the everything app’ (MarketWatch) Musk offers to proceed with Twitter deal (Axios) Lawyers Lose Out on Millions in Twitter-Musk Legal Fees (Bloomberg) Tesla is now building Model 3 and Model Y vehicles without ultrasonic sensors (TechCrunch) DDoS attack on 'Overwatch 2' servers prevents fans from playing the game on launch day (Engadget) Chess Investigation Finds That U.S. Grandmaster ‘Likely Cheated’ More Than 100 Times (WSJ) 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 TechMean Bright home for Wednesday, October 5th, 22. I'm Brian McCullough today. Yes, we'll get into the whole Twitter-Elon thing. Seems Elon wants the original deal once again. Or does he? Tesla is removing more sensors from their cars, the hugely problematic launch of Overwatch 2, and the tech angle to that whole chess cheating scandal. Here's what you miss today in the world of tech. Of course, Elon dropped all this mere minutes after I posted the show yesterday. It's meant he's left us with a day where there's basically too much news. Elon Musk, you might have heard, apparently wrote a letter to Twitter, reviving his original bid for the company at that $54.20

per share price, aiming it seems to avoid a courtroom fight that was scheduled to begin in mere days. Twitter's stock rose more than 20% yesterday on the news, though it has leveled out a bit overnight, quoting Bloomberg. In the letter, Musk's attorneys wrote that he and his supporters, quote, intend to proceed to closing of the transaction contemplated by the April 25th, 2022 merger agreement on the terms and subject to the conditions set forth therein, end quote. The plan is also contingent on him lining up the necessary debt financing and the court issuing an immediate stay of the action. It's a tough time for banks to sell debt with yields at multi-year highs. Banks led by Morgan Stanley could be on the hook for hundreds of millions of

dollars of losses on the unsecured portion alone should they attempt to unload it to investors. Musk's legal team was getting the sense that the case was not going well, as Judge Kathleen St. J. McCormick cited repeatedly with Twitter in pretrial rulings, according to one person familiar with the matter. Even with the late emergence of a Twitter whistleblower, who alleged executives weren't forthcoming on security and bot issues, there were concerns. Musk's side would not be able to prove a material adverse effect. The legal standard required to exit the contract. Musk was scheduled to answer questions about the deal in Austin, Texas on October 6th and 7th, according to a court filing Tuesday. Twitter chief executive Parag Agrawal

was scheduled to sit down for his deposition this past Monday. Musk later tweeted that, quote, buying Twitter is an accelerant to creating X, the everything app, end quote. Musk has said he wants Twitter to be more like TikTok and WeChat with many more highly engaged users, end quote. Yes, the super app, great. That's what everybody wants to be these days. I wonder why Twitter management never thought of doing that, but quoting MarketWatch. In a discussion with Twitter employees earlier in the acquisition process, Musk did bring up a desire to build a super app, a concept that has become ubiquitous in China with offerings like WeChat, but has yet to find an equivalent in the U.S. While the mention of turning X into its own app is new, Musk has a

a history with the letter well before Tesla released the Model X. One of Musk's first big wins, as an entrepreneur, was when his online bank, X.com, merged with another company to create PayPal holdings in 2000. When eBay bought PayPal for $1.5 billion in 2002, Musk received millions and proceeds, which he funneled towards Tesla and his rocket startup SpaceX. But he returned to X.com in 2017, reacquiring the domain, one of only three single-letter domains of for an undisclosed fee. Musk hasn't done much with X.com. The website currently exists with just a single X on a white background, but when he agreed in May to acquire Twitter for $44 billion, he established a holding company that would swallow Twitter once the acquisition completed,

and he named it X holdings, end quote. Anyway, as you can imagine, a whole bunch of people have a lot of takes on all of this, including a drumbeat of folks quietly saying, maybe this is a lot of noise that amounts to nothing. Maybe this is all just a delaying tactic, quoting Axios. Any agreement on terms relating to the original agreement would preempt a trial that had been scheduled for October, tied to Musk's efforts to walk away from his original acquisition agreement. The letter stipulates, however, that the deal hinges on the receipt of debt financing, as well as the Delaware Chancery Court entering an immediate stay of the action, adjourning the pending trial and all other legal proceedings related to closing the deal. Twitter has not said

whether it agrees to any next steps. Its lawsuit against Musk for backing out of the deal is still active. The Washington Post reports that Twitter's board is considering Musk's offer, which arrived overnight, but is taking its time to reply because of fears that it could be a legal ploy, end quote. And these are some tweets from the handle NYC Southpaw, quote, Musk has already terminated that merger agreement at least three times that I remember, so I wonder how eager his lenders and co-investors are to reaffirm their commitments. Serious people actually set aside money when they do that, and this reversal might not last the week. The text of the letter is helpful because, to my eyes at least, it makes clear, much more clear than the news articles about it, that Musk is seeking an adjournment of the trial and his upcoming deposition without actually promising anything new or giving up anything at all. The last four words are key if the deal, quote, otherwise fails to close, i.e. if Musk decides he doesn't want to again, then he's in no worse position than he was today in the litigation, but he'll have succeeded in delaying it for as long as he entertains the deal process this time. Of course, closing the deal on the agreed terms is the remedy Twitter is seeking from the court. So the offer is, quote, give up your forcing mechanism for a while with no compensation whatsoever from me and see if it makes me more likely to do what you want.

month, end quote. Also, as at Chancery Daily, and a lot of others have been tweeting, quote, merely agreeing to what you promised, but reneged on before doesn't get us any closer to a deal, end quote. And quoting Bloomberg, with all the lawyers in the case and the potential for other litigation to spin out of this, such as investor lawsuits, I could see the total legal fees reaching $1 billion, said John Coffey, a Columbia University law professor who teaches about M&A disputes, end quote. Well, aside from all of that, what if we were to Occam's razor this? The simplest answer is always the most likely one, right? Well, let's think about that in this case. I can remember one time in college when I did not have a lot of money and I was dating a girl out of state and I bought a

bunch of plane tickets and then forgot to, you know, actually take some of the trips. Those multiple $300 non-refundable tickets were a real punch in my budget at the time, but I got over it. I remember another time earlier in my life when I bought a $1,500 mattress and ruined it immediately because I installed the underlying bed frame slats incorrectly and thus broke the spine of the thing. I can remember literally sitting down on that mattress and head down morning throwing away $1,500 down the drain. Who among us hasn't played hands of poker online whilst drunk? Who among us hasn't made impulse purchases whilst drunk? the Occam's Razor thing here is, you know, Elon has bigger issues in his life, Tesla things, SpaceX

things, family things. And so, you know, like a house that has become a money pit, what if it's logical to just walk away? What if he's just decided this whole thing is a sunk cost? So move on, get over it. Sure, it would represent, I don't know, something like a third of his net worth, but hey, the other two-thirds of his net worth is still there. It's the better part of $100 billion. So swallow it. Move it. Move it. on. It stings, but you can survive it. What if that is what is going on here? But as I said online last night, if anyone out there is building a literal Twitter clone right now, please get in touch. The Ride Home Fund is willing to invest site unseen. Actually scratch that because that's the

exact mistake Elon made. I'd have to do at least some diligence. Tesla plans to remove ultrasonic sensors from some new Model 3 and Model Y cars this month, and Model S and X cars will see the sensors taken away in 2023, all in favor of camera and software assistance. Quoting TechCrunch, starting this month, all Model 3 and Model Y vehicles built for North America, Europe, the Middle East, and Taiwan will no longer include the 12 ultrasonic sensors typically found on the front and rear bumpers of its vehicles. Ultrasonic sensors, which measure distance by using ultrasonic waves, are generally used as proximity sensors to support anti-collision safety systems, particularly in low-speed applications like parking.

Tesla announced the changes about 17 months after it said it would remove radar from its vehicles. The decision to eschew radar or ultrasonics is a contrarian approach to the rest of the industry, which is adding not removing sensors from its vehicles to support ADAS. automakers typically use a combination of radar and cameras, and now even LiDAR, to provide the sensing required to deliver ADAS features like adaptive cruise control, which matches the speed of a car to surrounding traffic, as well as lane keeping and automatic lane changes. Tesla began its so-called Tesla Vision Plan in 2021 when it removed radar from Model 3 and Model Y vehicles made in North America, followed by Model S and Model X in 2022. Earlier this year, Tesla expanded that to include Model Y and Model 3 vehicles sent to customers in Europe and the Middle East. Tesla said the removal of ultrasonic sensors will begin with Model 3 and Model Y vehicles in 2023. It will include Model S and Model X vehicles.

The company said it is also launching a vision-based occupancy network that is used in full self-driving beta software, the $15,000 package that augments autopilot and is not self-driving, to replace the inputs generated by the ultrasonic sensors. Tesla claims this approach improves autopilot, giving it longer range visibility and the ability to identify and discern different objects. Tesla said that initially any vehicle delivered to customers without USS will have limited or inactive features such as Park Assist and Summon, which allows a person to move their vehicle forward or back via the Tesla app. Those features will eventually be restored via over-the-air software updates, the company said, end quote. Overwatch 2 was always going to be one of the biggest gaming launches of the year, except, according to Blizzard President, Mike Ybarra, the early access launch of the game yesterday into today, has been experiencing

a mass DDoS attack on its servers, preventing hundreds and thousands of users from even being able to join the game. Quoting in Gadget, fans have been reporting getting stuck on the loading screen and getting one error after another. They're also put in a queue behind hundreds and in some cases even tens of thousands of other players also trying to get in. Blizzard President Mike Youbar up initially tweeted that the game is experiencing survey issues and that the company's teams are working hard to fix it. In a follow-up tweet, though, the executive admitted that the game is, quote, experiencing a mass D-DOS attack on its servers, causing drop and connection issues. Blizzard developed the new free-to-play shooter for the Nintendo Switch, PlayStation 4, PlayStation 5,

Windows, Xbox 1, Xbox Series X and S. The new game reduces team sizes from 6 to 5, so a team gets only one tank. It also comes with new maps, new heroes, and new features, such as the ability to place a ping on the enemy's location to point them out to the rest of the team. Servers for the original Overwatch went offline shortly after its sequel launched, so fans have no choice but to wait for Blizzard to fix the issue before they can play the game again. Aside from mitigating the DDoS attack, Blizzard also has to fix quite a few bugs that made themselves known upon launch. They include items and currency going missing from players' collections, sections not populating, some areas becoming inaccessible, actions

resulting in a black screen and Blizzard's SMS protect, leaving the client unusable, end quote. Finally today, maybe you've heard of this story, but I mean, there is a tech angle here, so why not talk about it? Remember how major gaming platforms are trying to crack down on online cheating on games like Overwatch? Well, a report from chess.com has alleged widespread cheating in more than 100 online games by Hans, Mokie Neiman, who was accused of cheating recently by champion Magnus Carlson, quoting the Wall Street Journal. The report reviewed by the Wall Street Journal alleges that Neiman likely received illegal assistance in more than 100 online games as recently as 2020. Those matches included contests in which prize money was on the line. The site uses a variety of cheating detection tools, including analytics that compare moves to those recommended by chess engines,

which are capable of beating even the greatest human players every time. The report states that Neiman privately confessed to the allegations and that he was subsequently banned from the site for a period of time. The 72-page report also flagged what it describes as irregularities in Neiman's rise through the elite ranks of competitive in-person chess. It highlights, quote, many remarkable signals and unusual patterns in Hans's path as a player, end quote. While it says Neiman's improvement has been statistically extraordinary, chess.com noted that it hasn't historically been involved with cheat detection for classical. over-the-board chess, and it stopped short of any conclusive statements about whether he has cheated in person. Still, it pointed to several of Neiman's strongest events, which it believes, quote, merit further investigation based on the data, end quote. F-I-D-E, chess's world governing body,

is conducting its own investigation into the Neiman-Carlson affair. Outside his online play, Hans is the fastest rising top player in classical over-the-board chess in modern history, The report says, while comparing his progress to the game's brightest rising stars, looking purely at rating, Hans should be classified as a member of this group of top young players. While we don't doubt that Hans is a talented player, we note that his results are statistically extraordinary, end quote. Computers have nearly infallible tactical calculation, the report says, and are capable of beating even the best human every single time. The report says dozens of grandmasters have been caught cheating on the website, including four of the top 100 players in the world who confessed. identifying violations in over-the-board games remains a major challenge. The main reason is that Grandmasters who cheat require very little assistance. For a player operating in elite circles, a couple of subtle moves in critical spots can be enough to tilt a balance against a world champion. That makes definitively proving allegations of cheating difficult unless a player is caught in the act

by using a phone in the bathroom, wearing a small earpiece or receiving signals from someone in the audience. Neiman first crossed 2,300 in the ELO rating system used by chess in late 2015 or early 2016 as an obviously gifted preteen. It took him more than two years to push that number above 2,400 and another two to begin flirting with 2,500 Grandmaster territory in late 2020. He achieved Grandmaster status at the age of 17 in January 2021 and began his drive toward the rarefied atmosphere of the Super Grandmasters. This made him a relatively late bloomer compared to some of his peers. ELO system, the fastest way to make large jumps is to win a lot and beat people who are rated above you. Over the next 18 months, Neiman picked up more than 180 ELO points. Data collected by Chess.com, measuring the strength of his play, showed a rise steeper than any of the top young players in the world.

Quote, our view of the data is that Hans, however, has had an uncharacteristically erratic growth period mired by consistent plateaus, the report says. The report also addresses Neiman's post-game analysis of the moves from his game against Carlson, which top players say, showed a lack of understanding of the positions he had just played. It says Neiman's analysis seems, quote, to be at odds with the level of preparation that Hans claimed was at play in the game, and the level of analysis needed to defeat the world chess champion, end quote. So, just like how PC gamers are accused of cheating by being able to do all sorts of mods and hacks that give them unfair advantages and various first-person shooters and the like, if I'm reading this correctly, the allegation is that he cheated at online chess, and that that leads them to believe that somehow, in over-the-board chess matches, in-person chess matches, somehow, some way Neiman was, again, allegedly getting tips from infallible computers, sort of like how at a pub trivia contest, say, you might surreptitiously pull out your phone on the sly to Google the answers to things.

all morning long. I thought that the Google Pixel event was today. It is not. It is tomorrow. So in some of those segments, I might have said things like there was too much news today. Sorry if some of my wording is confusing in some segments. We actually did have more room to talk about things today than I thought. Tomorrow I will cover the Pixel News, though, tomorrow.

Talk to you then.