American Airlines Just Suffered a Huge Embarrassment. But Is It Really the Airline's Fault?

Absurdly Driven looks at the world of business with a skeptical eye and a firmly rooted tongue in cheek. 

Frequent business flyers can be an insipid, self-regarding bunch.

They watch the masses troop to the back of the plane, sip on their champagne and smugly pat themselves on the back for their evident superiority.

Airlines pander to them, of course. They want their money on a repeat basis. 

Sometimes, though, you have to wonder what goes through fine minds of so-called Elites.

Last weekend saw the release of a video — posted to Twitter by travel blogger Jamie Larounis — that starrred four female American Airlines Flight Attendants.

They were in slightly more alluring Flight Attendant attire than that normally seen on board.

And they were performing a skit in which they fawned all over a First Class passenger. 

You know, um, sexily.

The organizers of this, oh, entertainment, reportedly were some Executive Platinum and Concierge Key customers. Yes, American’s most important passengers.

It was held at a private venue and was supposed to raise money for charity.

Some might be less than charitable on seeing that the performance featured a large American Airlines logo in the background.

It’s not clear who took this liberty, but American did offer a few items for auction at this event.

I feel fairly sure its brand image wasn’t one of them.

Perhaps this was all good clean, humorous insider fun for these privileged types.

The part, however, that may have caused a little more consternation was when the four female Flight Attendants began to dance — with alleged sexy intent — around a First Class passenger.

To heighten the steamy effect, they sang Big Spender.

Yes, of course a Flight Attendant ends up sitting on the customer’s lap. You needed to ask?

The song was first performed in 1966.

And goodness me, this skit wouldn’t have looked out of place then.

These days, however, it might reek to many of bilge-brained sexism.

The fawning Flight Attendants are, reports say, real Dallas-based American Airlines Flight Attendants.

Which led the The Association of Professional Flight Attendants — representing American’s Flight Attendants — to demand an investigation.

There was the suspicion, you see, that the airline had some involvement in all this.

The Transport Workers Union — which also represents many American Airlines employees — saw the invisible hand of American’s management in the show. It claims this is all part of the airline’s strategy: 

Destroy blue collar America and expose air travelers to potential disaster by fixing AA planes on foreign soil, while simultaneously sexualizing and degrading their own flight attendants.

Naturally, I contacted American to ask for its view. It offered me the contents of a memo it sent on Sunday to all its staff. It read, in part: 

This was not an American Airlines event. We did not have any say about the content of the event, nor did we preview any of the agenda. Additionally, we were particularly upset to see our logo on the screen as the skit was performed.

Well, indeed. American also said: “We are as upset as many of you are with the video.”

It didn’t, at least in this memo, specifically rail against its manifest sexism. (Its utter lack of actual humor might have deserved a mention, too.)

Larounis, at American’s request, removed the video. Sadly, thanks to the internet’s cloying immediacy, it soon proliferated far and wide.

Many will hiss and tut at those who performed in this abject display.

Somehow, though, I can’t help but consider those who laughed and applauded. 

Flying regularly in First Class may have its privileges. 

I wasn’t aware that permission to be a sad, myopic, dunderheaded Neaderthal was one of them. 

With 4 Short Words, Amazon Just Revealed the Brutal Truth About Its Decision to Cancel HQ2 in New York. (So Many People Don't Want to Admit This)

It’s not a plan really, not a hidden secret message. It’s more of an expression of emotion. Maybe a realization of necessity.

In fact, while the text Amazon posted on its blog on February 14 runs 363 words, the most important part of this crucial passage is just four words long. But those four words speak volumes.

It starts with a dig at “state and local politicians” in New York, and a statement about how many New Yorkers supposedly supported the deal. Then, we get to the crucial part:

We are disappointed to have reached this conclusion–we love New York, its incomparable dynamism, people, and culture–and particularly the community of Long Island City, where we have gotten to know so many optimistic, forward-leaning community leaders, small business owners, and residents. 

There are currently over 5,000 Amazon employees in Brooklyn, Manhattan, and Staten Island, and we plan to continue growing these teams.

Those four crucial words? “We love New York.”

They’re not included by accident. In fact, I’ll bet this statement probably went through more writing, editing and rewriting than anything in Amazon’s history.

But the passage is crucial. It’s a recognition that even in a post-HQ2 world Amazon, still depends big time on New York. That’s why I think the company is at pains to reassure everyone that it isn’t going to try to just reopen the HQ2 search and do this elsewhere.

The brutal truth is: New York City is special.

I know people don’t like to admit this. I know that there are many trying to make political points, attacking union leaders and politicians who they say are to blame for Amazon running away.

But there is no other place truly like New York City, and Amazon isn’t really going to run — not completely. It’s not just chest-thumping; it comes down at least partly to sheer numbers. Here are three of them:

  • By far, New York is the largest city in America, with 8.6 million people–almost as big as the second, third, and fourth largest cities combined.
  • By far, it’s the largest metropolitan area: more than 20 million people. If it were its own state, it would be about as big as Florida — but much more densely packed.
  • By far, it has the largest GDP of any metro area, at at $1.7 trillion. That’s nearly 9 percent of the entire country.

Was it ever possible that Amazon would direct a personal insult at the largest and most important market in the country, by jilting it for say, Nashville? 

No offense to Nashville, the so-called runner-up. It’s a really great city too, but numbers don’t lie: it’s tiny compared to New York.

Remember, they just proved it at Amazon, too.

After staging a 14-month beauty contest, playing off more than 200 cities against each other, and keeping the terms secret so that none of them could know what they needed to do in order to win, the result was almost comically predictable:

Amazing n couldn’t do better than New York and an area right outside Washington, D.C. 

You know what I think’s going to happen now? Amazon is going to redistribute those 25,000 jobs around a lot of different places. (Remember, it was only planning to create 700 jobs this year, and wouldn’t hit the full number until 2028 at least.)

Now, New York will still get the largest share, only without having to give an average of $120,000 per job in tax breaks to get them.

And, it will make up the rest and still more–because Amazon just did the legwork for every other company in America.

Especially if the state and city can come up with anything even approaching a small percentage of the deal they were willing to give Amazon, and offer it to a wide array of smaller employers,  think things look pretty rosy.

No matter your size, and as long as you don’t try to squeeze completely one-sided terms out of the deal, if you want to attract amazing workers and expand in one of the greatest cities in the world, Amazon just proved where you should go. 

Amazon loves New York. And a lot of other people do too. 

Stocks To Watch: Spotlight On Walmart, Samsung And CAGNY

Welcome to Seeking Alpha’s Stocks to Watch – a preview of key events scheduled for the next week. Follow this account and turn the e-mail alert on to receive this article in your inbox every Saturday morning.

All eyes will be on Bentonville, Arkansas this week with Walmart (NYSE:WMT) due to release earnings on February 19. The retail giant is expected by many analysts to post strong numbers ($1.39B revenue, $1.33 EPS, +2.9% same-store sales) for the holiday quarter, which could also give a push up to shares of Target (NYSE:TGT), Costco (NASDAQ:COST) and Dollar General (NYSE:DG) – unless the cadence on consumer spending, pricing and labor pressure works in the opposite direction. “Walmart likely had a solid 2018 holiday season, helped by favorable macro trends and initiatives related to merchandising and digital,” previews Telsey Advisory Group ahead of the report. Walmart’s report follows closely after a puzzling December retail sales report that may have been a bit of an outlier. On the economic calendar next week, FOMC minutes and retail sales for January are due out on February 20, while a deluge of reports will pour out on February 21 – including updates on U.S. PMI, durable goods orders, existing home sales and the latest Philadelphia Fed Business Outlook reading. Trade talks between the U.S. and China will continue in Washington, although President Trump’s tease of a deadline extension has taken some of the pressure off.


Notable earnings reports: Walmart (WMT), Devon Energy (NYSE:DVN) and Terex (NYSE:TEX) on February 19; CVS Caremark (NYSE:CVS), Agilent (NYSE:A) and Albemarle (NYSE:ALB) on February 20; Hewlett Packard Enterprises (NYSE:HPE), Boyd Gaming (NYSE:BYD), Baidu (NASDAQ:BIDU) and Roku (NASDAQ:ROKU) on February 21; Wayfair (NYSE:W), Cinemark (NYSE:CNK) and AutoNation (NYSE:AN) on February 22. See Seeking Alpha’s Earnings Calendar for the complete list of earnings reporters.

IPO activity: Another quiet week is on tap for the IPO market with no new pricings anticipated. Investors will take a look at Carbon Black (NASDAQ:CBLK) earnings on February 19 and Dropbox (NASDAQ:DBX) earnings on February 21, but mainly there is a lull while government shutdown delays play out. While Levi Strauss (LEVI) created some excitement with its IPO filing as the company looks to enter new market categories, postponed public offerings from Cibus (NASDAQ:CBUS), BankFlorida (NASDAQ:BFL) and Virgin Trains (NASDAQ:VTUS) tempered enthusiasm that the IPO market is heating up.

CAGNY: Its official name is the Consumer Analyst Group of New York conference, but you might call it the Super Bowl of retail events with a huge number of consumer-facing companies set to present. Morgan Stanley says to expect companies to detail plans to reinvigorate market share and topline trends after sequential improvement towards the end of 2019, as well as give an update on recent pricing actions and highlight any benefits from a recent spot commodity drop. Discussion on emerging markets trends, M&A potential, labor pressures are also anticipated. The Morgan Stanley analyst team sees Procter & Gamble (NYSE:PG), Churchs & Dwight (NYSE:CHD) and Colgate-Palmolive (NYSE:CL) as well positioned to gain after their CAGNY talks. Other companies in Boca Raton from February 18-22 include Coca-Cola European Partners (NYSE:CCEP), General Mills (NYSE:GIS), International Flavors & Fragrances (NYSE:IFF), Ingredion (NYSE:INGR), Johnson & Johnson (NYSE:JNJ), Mondelez International (NASDAQ:MDLZ), Performance Food Group (NYSE:PFGC), Sysco (NYSE:SYY), Tyson (NYSE:TSN), Hershey (NYSE:HSY), Kellogg (NYSE:K), McCormick (NYSE:MKC), Altria (MO,) PepsiCo (NYSE:PEP), Philip Morris International (NYSE:PM), J.M. Smucker (NYSE:SJM), Constellation Brands (NYSE:STZ), Coca-Cola (NYSE:KO), Newell Brands (NASDAQ:NWL), Church & Dwight (CHD), Clorox (NYSE:CLX), Herbalife (NYSE:HLF), Spectrum Brands (NYSE:SPB), TreeHouse Foods (NYSE:THS) and Unilever (NYSE:UN).

Projected dividend changes (quarterly): Analog Devices (NASDAQ:ADI) to $0.52 from $0.48, Albemarle (ALB) to $0.35 from $0.335, CenturyLink (NYSE:CTL) to $0.25 from $0.54, Danaher (NYSE:DHR) to $0.18 from $0.16, Digital Realty (NYSE:DLR) to $1.07 from $1.01, Essex Property (NYSE:ESS) to $1.93 from $1.86, Foot Locker (NYSE:FL) to $0.38 from 34.5, Genuine Parts (NYSE:GPC) to $0.765 from $0.72, Garmin (NASDAQ:GRMN) to $0.55 from $0.53, LyondellBasell (NYSE:LYB) to $1.04 from $1.00, PSEG (NYSE:PEG) to $0.47 from $0.45, Prologis (NYSE:PLD) to $0.50 from $0.48, Sempra (NYSE:SRE) to $0.975 from $0.895, TJX (NYSE:TJX) to $0.21 from $0.195, Waste Management (NYSE:WM) to $0.5125 from $0.465, Williams Cos (NYSE:WMB) to $0.38 from $0.34. Walmart (WMT) to $0.53 from $0.52, Xcel Energy (NYSE:XEL) to $0.40 from $0.38, Armada Hoffler (NYSE:AHH) to $0.21 from $0.20, Cogent Comms (NASDAQ:CCOI) to $0.58 from $0.56, Cinemark (CNK) to $0.33 from $0.32, CyrusOne (NASDAQ:CONE) to $0.50 from $0.46, Carter’s (NYSE:CRI) to $0.49 from $0.45, Cubic (NYSE:CUB) to $0.15 from $0.135, Dick’s Sporting (NYSE:DKS) to $0.2475 from $0.225, Domino’s Pizza Inc. (NYSE:DPZ) to $0.65 from $0.55, Comfort Systems USA (NYSE:FIX) to $0.095 from $0.09, James River Group (NASDAQ:JRVR) to $0.35 from $0.30, LeMaitre Vascular (NASDAQ:LMAT) to $0.085 from $0.07, ManTech (NASDAQ:MANT) to $0.29 from $0.25, Marcus Corp (NYSE:MCS) to $0.175 from $0.15, MGP Ingredients (NASDAQ:MGPI) to $0.09 from $0.08, Insperity (NYSE:NSP) to $0.25 from $0.20, Universal Display (NASDAQ:OLED) to $0.09 from $0.06, Old Republic (NYSE:ORI) to $0.1975 from $0.195, Sturm Ruger (NYSE:RGR) to $0.30 from $0.21, Re/Max (NYSE:RMAX) to $0.22 from $0.20, Retail Opportunity (NASDAQ:ROIC) to $0.20 from $0.195, Ruth’s Hospitality (NASDAQ:RUTH) to $0.12 from $0.11, Service Corp (NYSE:SCI) to $0.19 from $0.17, Telephone & Data (NYSE:TDS) to $0.17 from $0.16, Texas Roadhouse (NASDAQ:TXRH) to $0.27 from $0.25, Domtar (NYSE:UFS) to $0.445 from $0.435.

Samsung: Samsung (OTC:SSNLF) plans to open three retail stores in the U.S. next week. The company is also holding a launch event for the new Galaxy S10 and other products on February 20.

New York Toy Fair: More than 30K studio executives, buyers and toy company reps will descend on Manhattan February 16-19 to take in the annual toy show, according to Variety. Over 7K international buyers are also expected to be in the house for the event. Companies looking to make a splash include Mattel (NASDAQ:MAT), Hasbro (NASDAQ:HAS), Funko (NASDAQ:FNKO), Spin Master (OTC:SNMSF) and JAKKS Pacific (NASDAQ:JAKK). The toy sector could use a lift after devastating guidance from Mattel late on Friday sent shares 18% lower.

Analyst/investor meetings: Ameren (NYSE:AEE) on February 20-21, Allakos (NASDAQ:ALLK) on February 19; Regenxbio (NASDAQ:RGNX) on February 21.

Business update updates/calls: Intercontinental Exchange (NYSE:ICE) on February 19, Raymond James Financial (NYSE:RJF) on February 20.

M&A tidbits: Shareholders at Cronos Group (NASDAQ:CRON) are due to meet on February 21 to vote on the C$2.4B investment by Altria Group (NYSE:MO). Lawyers from Rent-A-Center (NASDAQ:RCII) will be busy filing post-trial briefs on the legal battle with Vintage Capital.

Barclays Industrials Select Conference: The conference arrives at an unsettled time with the China trade deal still up in the air and transportation/logistics stocks bouncing around with an extra dash of volatility. Companies due to present at the event scheduled for February 20-21 include Caterpillar (NYSE:CAT), Cummins (NYSE:CMI), JetBlue (NASDAQ:JBLU), Norfolk Southern (NYSE:NSC), Parker-Hannifin (NYSE:PH), Regal Beloit (NYSE:RBC), Roper Technologies (NYSE:ROP),Sensata Technologies (NYSE:ST), Summit Materials (NYSE:SUM), Textron (NYSE:TXT), United Continental (NASDAQ:UAL), Gardner Denver (NYSE:GDI), Union Pacific (NYSE:UNP), United Technologies (NYSE:UTX), Woodward (NASDAQ:WWD), XPO Logistics (NYSEMKT:XPO), Honeywell (NYSE:HON), Aptiv (NYSE:APTV), C.H. Robinson (NASDAQ:CHRW), Danaher (DHR), Spirit Airlines (NASDAQ:SAVE), Rockwell Automation (NYSE:ROK), CF Industries (NYSE:CF), Johnson Controls (NYSE:JCI), General Dynamics (NYSE:GD), Lear (NYSE:LEA), United Technologies (UTX), J.B. Hunt Transport (NASDAQ:JBHT), Boeing (NYSE:BA), 3M (NYSE:MMM) and Avery Dennison (NYSE:AVY).

Breakfast wars: McDonald’s (NYSE:MCD) introduces Donut Sticks at select restaurant stock across the U.S. on February 20. The direct challenge to Dunkin’ Donuts (NASDAQ:DNKN) and Krispy Kreme by McDonald’s is a limited time battle until the restaurant chain gauges results.

Rocket ride: A SpaceX (SPACE) Falcon 9 rocket is scheduled to launch sometime in the February 21-22 window. The rocket will carry the PSN 6 communications satellite and SpaceIL’s Lunar Lander, which will be the first Israeli spacecraft to travel beyond Earth orbit and the first private lander on the moon.

Box office: Fox’s (NASDAQ:FOXA) Alita: Battle Angel, Warner Bros.’ (NYSE:T) The Lego Movie 2 and Universal’s (NASDAQ:CMCSA) Happy Death Day 2U are all expected to top $20M for the three-day weekend.

Barron’s mentions: Loews (NYSE:L) is called a conglomerate that investors can love due to its big discount to net-asset-value estimates. There is a cautious take on U.S. marijuana operators such as Curaleaf Holdings (OTCPK:CURLF), Acreage Holdings (OTCQX:ACRGF), Green Thumb Industries (OTCQX:GTBIF), MedMen Enterprises (OTCQB:MMNFF), Harvest Health & Recreation (OTCPK:HTHHF), iAnthus (OTCQX:ITHUF) and Trulieve Cannabis (OTCPK:TCNNF). Even though $50B in annual black-market spending could roll into a new consumer goods industry, the path to profitability is seen as rocky. The publication calls out stocks that look attractive in front of a data center boom, with Equinix (NASDAQ:EQIX), CoreSite Realty (NYSE:COR), Iron Mountain (NYSE:IRM) and InterXion Holding (NYSE:INXN) making the list.

Sources: CNBC, Nasdaq, EDGAR, Reuters, Bloomberg

CenturyLink: Don't Head To The Bomb Shelter

The big dividend cut by CenturyLink (CTL) came as a surprise to some shareholders, but my previous research indicated that investors remain focused on free cash flows and EBITDA margins. Whether or not the company uses the cash flows to pay dividends or reduce debt shouldn’t reflect on the stock as the value is in the ability to generate cash on a consistent and hopefully growing basis. Any stock weakness from cutting the dividend and maintaining cash flow targets provides a better entry point in the stock.

CenturyLink logo

Image Source: CenturyLink website

Dividend Slashed

Only last week, Citibank argued that CenturyLink would slash the dividend. Analyst Michael Rollins slapped a $11 price target on the stock making a bearish case around more capital spending and a focus on revenue growth issues.

The negative analyst call was odd considering the telecom had beaten estimates since the new CEO took over to the point that the dividend wasn’t really at question. Regardless, it appears that some investors evidently knew that a cut was on the way or were just wanting to push the stock down so far that the company would cut the dividend.

Along with the Q4’18 earnings report, the Board of Directors made the move to cut the dividend to $1.00, down from $2.16 per share. With the dividend up around 15% and so many analyst questions about the sustainability, a dividend cut wasn’t a huge bombshell.

The likely shock to the investor community is that CenturyLink is having any financial problems that would require a dividend cut. According to CEO Jeff Storey on the Q4’18 earnings call, the move was made purely to de-lever the balance sheet quicker:

However as you saw, we announced today that we plan to reduce the annual dividend to $1 from the current $2.16 per share beginning with the next dividend declaration. This decision is not based upon any concern for the outlook of our business. Our business fundamentals are strong and we believe our free cash flow could sustain the dividend at the prior level through 2019 and beyond. As I said, this change in policy isn’t about a diminished view of our business; it is driven by our view that the long-term interest of shareholders are best served by proactively accelerating, de-levering to a new lower target range of 2.75 to 3.25 times net debt-to-adjusted EBITDA.

Despite these facts, the stock is down over 40% in the last 6 months while the S&P 500 is only slightly down.

Chart

Data by YCharts

In fact, CEO Storey actually hinted at interest rate hike fears as the real reason for slashing the dividend payout to reduce leverage:

By reallocating more of our capital to leverage reduction, we believe, we will improve our cost of capital, return a significant amount of cash to shareholders at a very sustainable payout ratio, and provide additional flexibility to respond to market opportunities and any potential interest rate challenges that may occur. This is not something we did lightly but it is something we firmly believe is in the best long-term interest of our shareholders.

It sure sounds like the FED hiking interest rates in 2018 and the prospects of more hikes in the future caused CenturyLink to reconsider the acceptable leverage ratio.

About Those Cash Flows

A big key to understanding the story here is to look at the FCF progression in 2018. CenturyLink originally guided to FCFs of $3.15 to $3.35 billion for the year.

Source: CenturyLink Q4’17 presentation

The company ended up hitting an incredible $4.25 billion of FCF for the year. Due to a tax refund and other items that amounted to a $500 million bonus in 2018 that won’t repeat this year, the company was clear that the improved cash flows weren’t sustainable in 2019

Regardless, the guidance for 2019 has FCF at $3.10 to $3.40 billion. The most important detail is the capital expenditure guidance.

Source: CenturyLink Q4’18 presentation

A big key here is the capital expenditures of $3.50 to $3.80 billion or roughly 16% of revenues. The company has guided to a long-term target of ~16% of revenues, but CenturyLink didn’t hit those targets in 2018 with capex of only $3.175 billion.

In essence, the 2019 plan includes an ~$500 million boost to capital expenditures in comparison to some of the under spending in 2018. Clearly, the company could further boost cash flows by constraining capex, but the best idea is for CenturyLink to reestablish a higher level of capital spending.

The end result is solid capex spending and a dividend payout of only $1.075 billion with a payout ratio in the 30% range on FCFs of $3.25 billion. In addition, the leverage ratio was already improved by $1.7 billion in debt repayments in 2018 due in part to the extra FCFs last year. The goal of reaching a leverage ratio of 2.75x in ~3 years is another positive sign for the stock.

Source: CenturyLink Q4’18 presentation

Takeaway

The key investor takeaway is that all of the numbers indicate the dividend cut was indeed due to a focus on reducing leverage and improving the capital structure. No indication exists that the cut was due to financial problems out into the future, therefore, the stock is appealing down below $13 with a dividend yield that still sits over 7.5%.

Investors shouldn’t make the mistake of heading to the bomb shelter like with typical dividend cuts.

Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion or consult a financial advisor. Investing includes risks, including loss of principal.

Disclosure: I am/we are long CTL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

China ride-hailing giant Didi to lay off 15 percent staff this year: source

FILE PHOTO: A woman walks past a sign of station for Didi Chuxing in Beijing, China January 2, 2019. REUTERS/Jason Lee/File Photo

SHANGHAI (Reuters) – Didi Chuxing will lay off 15 percent of its staff or about 2,000 people this year, a source said, marking the ride-hailing firm’s first major cut back as it grapples with regulatory scrutiny and public backlash over the murder of two of its users.

Didi CEO Cheng Wei said at a meeting with management that the firm would focus on core mobility services and cut business units considered not critical to its main ride-hailing business in 2019, according to the source familiar with the matter.

But the Chinese ride-hailing giant will aim to hire more than 2,000 employees to focus on safety technology, product engineering and international expansion with the goal of maintaining its overall employee count, the source added on condition of anonymity as the information is not public yet.

A Didi spokeswoman declined to comment. Reports on possible job cuts at the company began to surface in late January.

Didi has been working to address consumer and government concerns over safety after a passenger was raped and killed by one of its drivers in August last year, about three months after another Didi user was murdered. A Chinese court has sentenced a man to death for the crime committed in August.

Concerns about safety have hobbled growth plans for Didi.

Didi, which successfully drove U.S.-based rival Uber out of China in 2016 to becoming the top ride-hailing player at home, is now facing financial strain due to competition from new entrants and the rise of bike-sharing services like Mobike.

This week, Chinese tech news website reported that Didi Chuxing lost 10.9 billion yuan ($1.6 billion) in 2018.

Didi’s valuation exceeded $65 billion after its 2018 funding round and was considering an IPO as early as that year, sources have told Reuters. The privately held firm had been valued at $56 billion in a 2017 fundraising.

Reporting by Josh Horwitz; Editing by Himani Sarkar

It Might Be Time to Stop Assuming Hotels Are the Best Option for Business Travel

I travel about 75,000 miles a year for business, yet I can’t remember the last time I stayed in a hotel. That may surprise many business travelers, but to me, it’s a relief. I suffered through years of expensive boutiquesor cookie cutter chains, uncomfortable mattresses and terrible breakfasts. Finally I gave up on hotels altogether, and I’ve never looked back.

For several years now, Airbnb has been the secret weaponto my business travel success. There’s an amazing variety of locations, types of lodging, and hosts. I’ve found wonderful places and fascinating people I never would have if I’d stayed in hotels.

1. Feels More Like Home

One of the biggest complaints about business travel is that you don’t have your stuff. It may sound silly, but the stuff and the people are what turns a house into a home. And if you can’t have the people while you’re traveling, at least you can have things more like your own stuff at home. Hotels can be so sterile – or worse yet, unsterile!

2. Cheaper than Hotels

I’ve saved a ton of moneyusing Airbnb instead of hotels. This is especially true for me because I’m willing to stay in a privatebedroom in a shared unit. Even if I weren’t into sharing, Airbnb-ing a fully private unit is often a huge savings over even a modest hotel. Don’t forget to consider a whole house rental for group business travel. It may be closer quarters with your colleagues than you’re used to, but think of it as bonding time. Everyone could still get their own bedroom, and you can save using group transportation and food options.

3. Healthier Eating

In the last 2 years, I’ve lost – and successfully kept off– 54 pounds. One of the benefits of Airbnb is that many units provide a fully functional kitchen, often including staples like salt, pepper, and olive oil. All I had to do was take a quick trip to the grocery store. Then instead of eating bad take out or overindulging at a restaurant, I could cook exactly what I wanted at exactly the calorie count I could afford. No more temptation for midnight room service. It saves calories and money – and you can multiply the savings by making your own lunch, too.

4. Often More Convenient

Business travel can be unpredictable, and often doesn’t leave flexibility for changingdates. So what can you do if you have to go visit a client at the same time as the World Taxidermy & Fish Carving Championships, and every hotel room in Springfield, Illinois, is booked? Airbnb to the rescue. Just like hotels, Airbnb prices go up with demand, but I’ve never had a problemfinding an Airbnb that worked. Sometimes the Airbnb is considerably more convenient to where I need to spend time. I also often save money on parking by avoiding expensive hotel garages.

5. Opens Opportunities – and Eyes

One of the most fun and powerful reasons to use Airbnb is the amazing experience it can provide. While others are isolated in boring hotelsfilled with other businesspeople, you’ll be living among the local people. The hosts can share a great deal about the local way of life, which may be helpful in dealing with your client. The fellow guests, if you have them, often have wonderful stories to tell. For this and all the above reasons, Airbnb makes travel easier and more accessible, which means you can experience even more of this world!

7 Reasons To Start Your Own Company in Your 20s

The traditional narrative for entrepreneurs is a step-by-step process that generally looks something like this:

  1. Get a degree
  2. Get a job
  3. Build a network
  4. Save some “seed capital”
  5. Start your business

The assumption is that you’ll be ready to launch your startup in your 30s or 40s. Or maybe your 50s because, well…, kids.

Now, I don’t want to burst any happy bubbles for those of you who are already treading the traditional pathway, but that traditional narrative no longer makes much sense because over the past two decades, big corporations, big academia, and big corporatist government have rigged the business world so that the longer you wait to start your own company, the less likely you are to be successful. 

Because of this, young entrepreneurs (Millennials and Gen-Zers) should launch their startups immediately rather than waiting until they’ve got a degree and some experience. Here’s why:

1. College has become increasingly irrelevant.

If you already know you’re going to be an entrepreneurs, college is a waste of time. Business colleges are so out of touch that very few teach sales skills–the most important business skill for any entrepreneur. B-schools are also notorious repositories of wannabee entrepreneurs spouting clouds of fluffy biz-blab. Furthermore, colleges are always a decade behind the real world in technical skills and technology. Example: almost all computer animation college programs lack even a single class on real-time animation, the most important new technology in that industry.

2. College has become absurdly expensive.

How many thousands of times have you read about recent college graduates who can’t get a decent job in their field but are nonetheless saddled with tens of thousands of dollars in student debt? By contrast, how many times have you heard successful entrepreneurs say: “wow, I’m sure glad I graduated from college…”? Like never, right? Look, if you’re going to spend yourself $50,000 into debt, do you want to end up with a useless, but largely symbolic degree? Or do you want to own a business that cost $50,000 to start?

3. College doesn’t impress recruiters anyway.

Let’s suppose you want to start your own business but you’re banking on your college degree as a backup plan… as in “I’ll give this startup my best shot but if I fail I can get use my degree to get a job.” Well, IMHO, if you’re thinking that way, you’re setting yourself up to fail as an entrepreneur, but whatever. Let’s suppose it’s a reasonable plan. Hate to tell you, but recruiters are far more impressed by an effort to start your own company than whatever cookie-cutter degree you managed to eke out of the college system. Even fancy Ivy League degrees don’t have much cachet any longer.

4. Employers hire contractors not employees.

According to a recent study conducted by Allison & Taylor Reference Checking, “the current growth of freelancing is estimated to be three times faster than that of the traditional workforce, with approximately 47% of working millennials now working in some freelance capacity.  At the current growth rate, the majority of the U.S. workforce will freelance by 2027.” Freelance positions lack benefits and pay less, thus making it more difficult to put aside the money you’ll need to start your business. Can you spell “dead end street,” boys and girls?

5. Employers legally limit your options.

You may think you’re gaining valuable experience and contacts that you can use to launch your own business, but chances are that your employee agreement or “work for hire” agreement vastly limits your ability to use whatever you’ve learned. You might launch your business and find yourself at the short end of a lawsuit, from a company that can afford an entire staff of lawyers to make sure you’re properly crushed.

6. Resumes don’t impress investors.

Investors don’t give a rodent’s posterior about your college experience. They also don’t value your work experience much more than that, unless what you were doing was directly relevant to building and running the company you’re envisioning. Investors want people who’ve successfully started their own businesses or, at the very least, somebody who’s gained the valuable experience of starting a business that didn’t pan out.

7. Exuberance is a limited resource.

You may think all those long hours and hard work working for somebody else is preparing you for the long hours and hard work you’ll need to make your startup successful. But you’d think wrong. Their plan is to burn through your youthful energy and enthusiasm until you’re an empty husk. Even if you keep your spirits up and your body in tip-top shape while they try to suck you dry, as you get older, you will INEVITABLY find it more difficult to summon extra oomph. Far better to expend your youthful exuberance making your own business a success, rather than lining someone else’s pockets, right?.

Tesla rolls out 'sentry mode' safety feature

FILE PHOTO: A Tesla logo is seen at a groundbreaking ceremony of Tesla Shanghai Gigafactory in Shanghai, China January 7, 2019. REUTERS/Aly Song/File Photo

(Reuters) – Elon Musk’s Tesla Inc on Wednesday launched a safety feature called “sentry mode” for its electric cars, as it attempts to make its vehicles more attractive to buyers.

The feature will be compatible with U.S. Model 3 vehicles, followed by Model S and Model X vehicles that were manufactured after August 2017, the electric carmaker said.

When enabled, the “sentry mode” monitors the environment around an unattended car and uses the vehicle’s external cameras to detect potential threats, according to Tesla’s blog here

A minimal threat will be detected if anyone leans on the car, triggering a message on the touchscreen and warning that its cameras are recording.

For a more severe threat, like someone breaking a window, the mode activates the car alarm, increases the brightness of the center display, plays loud music and alerts owners on their Tesla mobile app.

The United States had 773,139 motor vehicles stolen in 2017 – the highest since 2009, according to data from the U.S. Federal Bureau of Investigation. here

Last week, Tesla lowered the price of its Model 3 sedan for the second time this year to make its cars more affordable for U.S. buyers. The Palo Alto, California-based company has been cutting costs as it looks to turn in profit this year.

Reporting by Sanjana Shivdas in Bengaluru, Editing by Sherry Jacob-Phillips

Cities Spurned By Amazon for HQ2 Renew Courtship After Winning New York Has Second Thoughts

As Amazon faces political obstacles in building a huge office in New York City, cities that were once candidates for the campus are courting the tech giant once again.

Cities including Miami, Chicago, and Newark, NJ have all recently talked to Amazon, brushing off their earlier rejections in hopes of landing thousands of jobs. Then Denver and Dallas said they never stopped speaking with Amazon.

Since announcing plans to build a new “second headquarters” in New York City three months ago, Amazon has encountered intense blowback. New York politicians are balking at a plan to hand over huge financial incentives to one of the biggest companies in the world while local residents complain about the impact of thousands of new workers on an already expensive and crowded neighborhood.

The opposition has Amazon second-guessing its move into the city, according to media reports, opening the door to former candidates to dust off their old proposals.

Last year, Amazon last year received 238 bids for the new headquarters, which originally was planned for one city. Candidate cities made big offers—like Maryland’s $8.5 billion incentive package—in hopes of landing the giant.

After going through the proposals, Amazon released a list of 20 finalists, which included Atlanta, Austin, Boston, Chicago, Denver, Los Angeles, Miami, and Columbus, OH—though very few of these cities publicly disclosed the incentives attached to their bids.

Ultimately, Amazon decided to change course and name two winning cities, but with only 25,000 job each. In addition to New York City, the company chose Crystal City, VA.

And while many losing cities were disappointed about being passed over, a few now are taking advantage of the tension in New York for a second chance with Amazon.

Illinois governor J.B. Pritzker, who previously helped pitch Chicago, immediately jumped on the phone with Amazon.

“Governor Pritzker reached out to Amazon to make a full-throated pitch to attract these good-paying jobs to Illinois and assure them that they would have a strong partner in the governor’s office,” Jordan Abudayyeh, spokeswoman for the governor’s office, told Fortune in a statement.

Meanwhile, Newark, NJ contacted Amazon to let the company know the city and state still have incentive packages, approved before the city was rejected, waiting for Amazon. Officials hope the news will show Amazon that it can move in without any risk of second guessing.

Miami-Dade’s mayor Carlos Giménez told the Miami Herald that he’s ready to restart talks about bringing the Amazon to Miami or other South Florida sites that were included in an earlier joint bid. The mayor of Magic City, Fla., said he planned to reach out to Amazon CEO Jeff Bezos to pitch him directly, according to the Herald.

A representative of the Dallas Regional Chamber said during a panel that that organization “never hung up the phone with Amazon,” according to media reports. The chamber declined to comment on whether Dallas planned to approach the company directly.

But Dallas mayoral candidate Jason Villalba was vocal about the matter on Twitter, saying, “Dallas can win this bid!” Undoubtedly, he also was using the issue as a way to highlight his experience in economic development to voters.

Similarly, The Dallas Morning News took the opportunity to write an op-ed titled, “Dear Amazon, New York doesn’t want you; Dallas does.” Mind you, the Morning News’ former headquarters is one of the potential sites for Amazon’s headquarters that Dallas listed in its proposal—a financial consideration that the News failed to mention.

Japanese self-drive cars map developer to buy rival U.S. startup for $200 million

(Reuters) – Japanese map platform developer Dynamic Map Platform announced on Wednesday it plans to acquire Detroit-based map startup Ushr for up to $200 million in a bid to widen its geographical footprint in the burgeoning self driving cars market.

Dynamic Map Platform counts Japan’s Toyota Motor, Nissan and Honda among its investors, while Ushr provides 3D mapping data to General Motors.

The move comes as the Japanese car makers seek to challenge Alphabet Inc’s Google and Chinese rivals in the mapping business.

For the acquisition, Dynamic Map Platform said it would raise a combined 22 billion yen ($198.9 million) from investors including two existing shareholders – the Japanese state-backed INCJ fund and Mitsubishi Electric.

“Through the combination, we will be able to offer automotive OEMs a comprehensive high-definition mapping solution for the North American and Japanese markets, with the ability to expand globally in the future,” Tsutomu Nakajima, the head of Dynamic Map Platform, said in a statement.

Reporting by Rashmi Ashok in Bengaluru and Makiko Yamazaki in Tokyo; Editing by Stephen Coates and Muralikumar Anantharaman

Jeff Bezos Letters Weren’t Extortion, David Pecker’s Lawyer Says

The lawyer for the chairman of the National Enquirer’s parent company said there wasn’t any blackmail, extortion or political motivations involved in the fight between the tabloid and Jeff Bezos, the founder of Amazon.

Photos and other details about Bezos’s extramarital affair came from “a reliable source” known to Bezos — and not from President Donald Trump, Saudi Arabia or Trump adviser Roger Stone, said Elkan Abramowitz, an attorney for David Pecker, chairman, chief executive and president of American Media Inc.

“It was a usual story that National Enquirer gets from reliable sources,” Abramowitz said on ABC’s “This Week” on Sunday. He didn’t name the source.

In a public blog post Feb. 7, Bezos published letters from lawyers representing AMI who demanded he drop a private investigation into the company — or else it would publish more embarrassing photographs about the wealthy businessman. Bezos accused the National Enquirer publisher of extortion.

Bezos’s post referenced Pecker’s connections with the Saudis and suggested more would come to light. The Amazon founder, who also owns the Washington Post, also appeared to be making references to that paper’s aggressive investigation of the murder of Jamal Khashoggi, who wrote for the paper, and the seeming reluctance of the Trump administration to hold Saudis responsible despite that assessment by the intelligence community.

“It absolutely is not extortion and not blackmail,” Abramowitz said. He suggested the letters were an attempt to resolve differences because Bezos didn’t want another story about him and AMI “did not want to have the libel against them that this was inspired by the White House, inspired by Saudi Arabia or inspired by the Washington Post,” the lawyer said.

A Saudi Arabian envoy, Adel al-Jubeir, said in an interview airing on CBS’s “Face the Nation” on Sunday that the kingdom had nothing to do with the leaks to AMI and “this sounds to me like a soap opera.”

Federal prosecutors are reviewing the National Enquirer’s handling of its story about Bezos to determine whether the company violated an earlier cooperation deal with prosecutors, according to two people familiar with the matter.

Bezos Blackmail Charge Intensifies Proxy War With Trump

AMI agreed not to commit crimes as part of that deal to avoid prosecution over hush-money payments to women who claimed relationships with Trump. Michael Cohen, Trump’s former lawyer, played a pivotal role in some of the payments and has pleaded guilty to related charges.

Asked whether he’s worried that the Bezos revelations have put the cooperation agreement in jeopardy, Abramowitz responded, “absolutely not.”

Abramowitz also said while AMI has sought financing from the Saudis, it “never obtained any, doesn’t have any Saudi Arabian finance.”

Bezos said last month that he and his wife, MacKenzie, were divorcing, in an announcement that came just hours before the Enquirer reported that Bezos had been having a relationship with another woman. Bezos hired a private investigator, Gavin de Becker, to learn how the texts were obtained and “to determine the motives for the many unusual actions taken by the Enquirer.”

The new Picasso? Meet Ai-Da the robot artist

FALMOUTH, England (Reuters) – Can robots be creative? British gallery owner Aidan Meller hopes to go some way towards answering that question with Ai-Da, who her makers say will be able to draw people from sight with a pencil in her bionic hand.

A woman interacts with Ai-Da, a humanoid robot capable of drawing people from life using her bionic eyes and hand, at the offices of robotics company Engineered Arts, in Falmouth, Cornwall, Britain February 7, 2019. Picture taken February 7, 2019. REUTERS/Matthew Stock

Meller is overseeing the final stages of her construction by engineers at Cornwall-based Engineered Arts.

He calls Ai-Da – named after British mathematician and computer pioneer Ada Lovelace – the world’s first “AI ultra-realistic robot artist”, and his ambition is for her to perform like her human equivalents.

“She’s going to actually be drawing and we’re hoping to then build technology for her to paint,” Meller said after seeing Ai-Da’s prosthetic head being carefully brought to life by specialists individually attaching hairs to form her eyebrows.

“But also as a performance artist she’ll be able to engage with audiences and actually get messages across; asking those questions about technology today.”

Her skeletal robotic head may stand disembodied on a workbench, but her movements are very much alive.

Cameras in each of her eyeballs recognize human features – she will make eye contact and follow you around the room, opening and closing her mouth as you do. Get too close and she’ll back away, blinking, as if in shock.

Ai-Da’s makers say she will have a “RoboThespian” body with expressive movements and she will talk and answer questions.

“There’s AI (artificial intelligence) running in the computer vision that allows the robot to track faces to recognize facial features and to mimic your expression,” said Marcus Hold, Design & Production Engineer at Engineered Arts.

Ai-Da’s makers are using “Mesmer” life-like robot technology for her head, and once finished she will have a mixed race appearance with long dark hair, silicone skin and 3D printed teeth and gums.

“(Mesmer) brings together the development of software mechanics and electronics to produce a lifelike face with lifelike gestures in a small human sized package,” Hold said.

Ai-Da will present her inaugural exhibition “Unsecured Futures” in May at the University of Oxford, and her sketches will go on display in London in November.

Reporting by Matthew Stock; writing by Marie-Louise Gumuchian; editing by John Stonestreet

The Next Era of Innovation Will Emphasize Privacy and Individualization, Report Says

Over the next three years, companies will give consumers more control over their data, privacy, and how they interact with products and services, according to a new report.

“Companies are amassing tremendous amounts of information about consumers,” said Paul Daugherty, Accenture’s chief technology and innovation officer. “The key thing for companies to think about is just because you can do something doesn’t mean you should do something.”

The insight comes from Accenture’s Technology Vision 2019 report released on Thursday. The annual report predicts key technology trends that will redefine business over the next three years.

Successful brands will have to build trusted relationships with consumers, the report says, and that includes providing transparency and giving consumers control of their data. If consumers trust a brand, they’re more likely to offer up even more data in exchange for a better experience—thus continuing the cycle of improving the product or service and growing the business.

Given recent privacy and data breach blunders from big technology companies like Google and Facebook, industries facing less heat over privacy may have a leg up in developing these deeper relationships. For example, insurance or financial services companies could ask their customers for permission to track more things about them, like the number of steps they take daily or their spending habits, to provide more customized offerings.

“This next generation [of innovation] is not going to be led by just technology companies,” said Michael Biltz, managing director of Accenture’s report. “It’s going to be led by all of these companies that have transformed themselves into digital businesses.”

While in recent years, technology companies have led the way in developing more personalized services, they have served as the “canaries in the coal mines,” said Daugherty. Through their mistakes, tech companies have shown other industries what not to do when it comes to handling consumer data. As a result, they left room for old-line industries to leverage their better relationship with consumers to introduce data-dependent products. Tech companies may have a harder time convincing their users to give up their personal information for similar services.

And though Accenture supports federal data privacy regulation, future innovation likely will be dependent on self-regulation, as laws struggle to keep up with advances in technology.

Here are all five trends outlined in the report:

  • The power of DARQ: Companies must understand and take advantage of distributed ledgers like blockchain, artificial intelligence, extended reality (a catchphrase for virtual and augmented reality), and quantum computing (a nascent technology that promises faster data crunching).
  • Get to know me: Understand more about consumers using the data trail they leave online to better develop personalized experiences as a way to unlock new business opportunities.
  • Human + worker: Companies of all kinds should redefine employee roles to take into account new technologies like artificial intelligence.
  • Security first: Businesses will have to recognize they are the conduit for data breaches rather than victims. They’ll have to be diligent about not just protecting of their internal and customer data, but also that of their partners and vendors.
  • Meet consumers now: Capitalizing on “momentary markets,” or markets that spring up and then vanish, will be critical. Successful companies will have to move quickly and take advantage of the on-demand economy and growing expectations by consumers for customization.

Tesla cuts Model 3 price for second time this year

FILE PHOTO: Rows of new Tesla Model 3 electric vehicles are seen in Richmond, California. REUTERS/Stephen Lam/File Photo

(Reuters) – Electric carmaker Tesla Inc is lowering the price of its Model 3 by $1,100, citing the end of a costly customer referral program, a company spokeswoman said on Wednesday.

The second price cut to the Model 3 this year now brings the cost of its least expensive variant to $42,900, according to the company’s website here.

Tesla’s customer referral incentive plan ended on Feb. 1 after Chief Executive Officer Elon Musk had tweeted that the referral program was “adding too much cost to the cars, especially Model 3”.

Tesla delivered fewer-than-expected Model 3 sedans in the fourth quarter and cut prices for all its vehicles in the United States to offset a reduction in a green tax credit.

The company is rapidly increasing production of its Model 3 sedan and lower prices could help it reach a broader customer base than its pure luxury vehicles.

Reporting by Sanjana Shivdas in Bengaluru; Editing by Gopakumar Warrier

Trump's State of the Union Is Silent on Key Tech Issues

In his State of the Union address Tuesday, President Trump promised legislation to invest in “the cutting edge industries of the future.” But the speech was characteristically backward-looking. Trump talked up gains in manufacturing jobs and oil and gas exports, but didn’t once mention the word “technology,” nor any other tech policy issue, such as privacy, broadband, or antitrust.

Aides filled in the blanks. “President Trump’s commitment to American leadership in artificial intelligence, 5G wireless, quantum science, and advanced manufacturing will ensure that these technologies serve to benefit the American people and that the American innovation ecosystem remains the envy of the world for generations to come,” Michael Kratsios, deputy assistant to the president for technology policy, said in a statement.

Still, some of the administration’s other signature policy positions, such as the trade war with China and its hardline position on immigration, may be holding back progress in these areas.

5G Wireless

Of these issues, the Trump administration has perhaps been most active on 5G, an umbrella term for “next generation” wireless technologies and standards that could one day enable download speeds of up to 10GB on your phone, or around 10 times the speed of Google Fiber’s standard home service. We’re still a long way from seeing those types of speeds in reality, even as carriers begin offering “5G” branded services in a few cities.

Politicians and pundits across the political spectrum warn that if the US falls behind China in deploying 5G, the next generation of mobile platforms could emerge in China, just as Android and iOS and their respective app stores emerged in the US during earlier wireless eras.

The Trump administration sees the race to 5G as a national security issue, as much as an economic issue. The US has long feared that Chinese telco giant Huawei could plant “backdoors” in its equipment that the Chinese government could use to spy on US citizens. US carriers like AT&T and Verizon are effectively banned from using Huawei gear in their networks; but the Trump administration fears that if China gets a leg up on 5G, there will be few if any alternatives to Huawei and other Chinese vendors to build the next generation wireless networks. That led to the unusual decision to block Singapore-based chipmaker Broadcom from buying US wireless chip giant Qualcomm, even though Broadcom offered to relocate to the US.

Beyond efforts to curb Huawei’s global reach, the White House hosted a summit on 5G last September, and Trump has encouraged federal agencies to accelerate the construction of 5G networks. Much of the focus is on opening up more wireless spectrum to carriers. The Federal Communications Commission, which is responsible for licensing access to the spectrum, has identified a few chunks of spectrum that can be repurposed for 5G. Its first 5G-related spectrum auction ended last month, and another is scheduled to begin March 14. But carriers say they need more.

In a comment filed last month with the National Telecommunications and Information Administration, which advises the president on telecommunications policy issues, the industry group CTIA complained that less than 6.5 gigahertz of spectrum is devoted to mobile wireless while nearly 30 gigahertz is dedicated to satellite communications.

Trump signed a memo last year calling for a national strategy to allocate more spectrum to 5G, but it was short on specifics. In 2017, Senators Cory Gardner (R-Colorado) and Maggie Hassan (D-New Hampshire) introduced a more detailed plan called the Airwaves Act, which identifies several ranges of spectrum frequency that could be repurposed and auctioned off several years. The bill was reintroduced in the House last year but has yet to see a vote in either chamber.

Apart from auctioning spectrum, the government has been mostly focused on slashing telecom regulations on the theory that it will encourage more investment.

For example, the FCC repealed its Obama-era net neutrality protections, which banned broadband providers from blocking, throttling, or otherwise discriminating against lawful content. FCC Chair Ajit Pai argued, despite ample evidence to the contrary, that the change was necessary, in part, because the rules deterred investment in broadband infrastructure.

LEARN MORE

The WIRED Guide to 5G

A real national broadband policy needs to serve the needs of the public, not just the carriers. “The problem is that the wireless industry is very good at using this hype to blow through any sort of regulatory oversight that’s designed to protect consumers, and to ignore the problem of rural broadband,” says Harold Feld of the consumer group Public Knowledge. Without oversight, Feld says, the industry might not deploy the fastest 5G technologies in places they consider less profitable, like low-income areas.

Regulators would do well to keep that in mind when considering T-Mobile’s proposed acquisition of Sprint. The companies say the merger would enable them to build 5G networks faster. But it would also reduce competition for wireless services, and could lead to higher prices.

Meanwhile, there’s more the government could do to help the US stay competitive in 5G. Building 5G networks will be expensive. One of the main technologies that carriers hope to use takes advantage of what’s called “millimeter wave” spectrum. Using this part of the spectrum could enable the mind-boggling speeds 5G boosters promise, but blanketing cities and towns with millimeter wave signals would require a huge number of cellular towers. These could be as small as smoke detectors, but just like your home WiFi router, these “micro-cells” will need wired connections to the internet. That will mean a big investment in fiber-optic networks that hardly anyone is talking about.

Last year, leaked documents revealed a proposal for the government to build a 5G network to complement commercial networks. The idea was widely panned across the political spectrum, and the White House denied that the idea was ever seriously considered. But, as Harvard Law professor Susan Crawford wrote for WIRED last year, a national program to build more fiber optic networks isn’t a crazy idea.

Ironically, the Trump administration’s trade war with China may be hampering the US’s progress on 5G, says FCC commissioner Jessica Rosenworcel. “There are new tariffs on Chinese imports on key network inputs like modems, routers, and antennas,” she tells WIRED in statement. “They raise the price of deployment of 5G domestically and make it harder for the United States to lead.”

But during Tuesday’s address, Trump doubled down on tariffs.

AI and Quantum Computing

Although Trump didn’t mention the technology specifically Tuesday night, the White House had already signalled it would take a stronger interest in artificial technology in 2019.

National AI strategies are becoming quite popular—outside the US. A Canadian report from December noted 18 national or pan-national AI plans, including those from China, France, and the European Union.

The US should join that roll in the next few months. In December the White House Office of Science and Technology Policy’s lead on AI said that the US would have a new AI research strategy this spring.

The OSTP statement released Tuesday name-checked AI but didn’t offer any specifics on what new support Trump might offer people or companies working on the technology. In its limited AI engagement so far, the administration has portrayed AI primarily as a way to exert dominance over other nations. The Pentagon has established a Joint AI Center to speed adoption of the technology by US forces. A one-day White House summit on AI last year focused on how it gives the US an economic advantage. And the Department of Commerce is considering whether to use arms-control rules to restrict US companies from exporting some AI technologies, in areas such as image recognition or machine translation.

Chris Meserole, a fellow at the Brookings Institution, hopes the Trump administration can broaden its view of AI. The government needs to pay close attention to the technology’s effects on society as it is adopted in areas such as finance, education, law enforcement, and moderating online speech, he says.

Trump will also need to consider how his tough stance on immigration could undermine what OSTP’s Kratsios called his “commitment to American leadership in artificial intelligence.” That leadership is built on the diverse talent at American research institutions and tech companies. “It’s a small pool of folks, maybe ten to twenty thousand people, and a lot of those are foreign born Americans,” Meserole says. “We’re going to need a sensible immigration policy to maintain our lead in AI.”

Talent is also an area of concern for quantum computing, another emerging technology in which the US has a lead Trump says he wants to maintain. In December, he signed a bill that authorizes more than $1.2 billion of spending in support of quantum R&D and talent development over five years.

But new funds have not yet been appropriated for the program. Backers of the bill like Chris Monroe, a professor at the University of Maryland and CEO of quantum computing startup IonQ, say that Trump’s immigration policies are undermining efforts to expand America’s pool of quantum engineers. “The scientific community is aligned on that we want to keep these people here, and encourage more people to come,” he says.

As expected, Trump talked up his dream of a border wall. But he had nothing to say about attracting the sort of talent the US will need to lead in the cutting edge industries of the future. Let’s hope the actual legislation has more substance.


More Great WIRED Stories

Tom Brady Kept Saying 1 Simple Word Over and Over After the Super Bowl. (And Taught an Amazing Lesson in Leadership)

Tom Brady has now won more Super Bowls than any other player in NFL history.

And in the minutes after the game, we got a small insight into why he’s so successful — after he kept using the same single word over and over and over.

You probably saw this unfold if you watched the game to the end: the giant scrum that erupted at midfield afterward, as CBS journalist Tracy Wolfson tried to get an interview with Brady, but he kept eluding her to embrace and congratulate other players.

It was fascinating in that we could hear snippets of the private conversations he was having on the field. The first player he rushed to embrace was Los Angeles Rams wide receiver Brandin Cooks.

“Cookie!” Brady yelled, as he pushed through the crowd on national television, to hug Cooks. “Love you man. Love you. You had an unbelievable year.”

Then, Rams running back C.J. Anderson (it was tough to hear what they said), but then Patriots wide receiver Julian Edelman. It’s an emotional, but we can hear what Brady says at the end of their embrace: “I love you dude. I love you dude.”

Brady also has a long embrace with Patriots owner Robert Kraft. Again, it’s a scrum, and you can’t make out much of what’s being said. But at the very end: “I love you.”

Let’s talk a bit about that word: love.

Some of us are afraid of it. Others probably use it too quickly, maybe too often. But we all know that it’s probably the most powerful emotion and feeling. 

As I saw Brady telling player after player (and an owner) that he loved them, I thought of an Army officer I interviewed in Iraq back in 2007. He had a family back home, and the separation of multiple combat tours was taking its toll.

He was starting to wonder whether he should get out of the military — but every time he thought of it, he stopped. Why did he stay? 

“I love Joe,” he told me. (“Joe” being slang for soldiers). 

To hear Brady saying that word over and over: “Love you.” “Love you dude.” “I love you.” 

It was striking. It’s part of the key to true leadership. I know of course that after winning a sixth Super Bowl, it was an emotional time for everyone on that field. 

But even so, it was notable. How often do you profess love for your work colleagues? For the people who work for you? 

I wrote recently about how Brady says the same simple four-word phrase to every new player on the Patriots when he meets them: “Hi, I’m Tom Brady.”

It’s obvious, right? Except that it’s not necessary.

Everybody who joins the Patriots knows who Tom Brady does. But besides being nice, and friendly, it sort of bridges the gap with new players who haven’t proven themselves yet.

This four letter word, “love,” does something very similar.

If you truly want to be a leader, and you want the people you’re leading to trust you implicitly, I think you have to be willing to let yourself love them.

Sometimes, you have to make sure that they know it. And sometimes, it means being willing to say it.

Tech Companies Have a Brand Image Problem: Here's How to Solve It

Tech companies everywhere, but especially those in Silicon Valley, have a serious brand image problem. Over the past few years, major tech companies have drawn ire from the public for their lack of diversity, apathy toward privacy issues, as well as their accumulation of wealth.

This isn’t exactly stopping people from using the tech products we’ve come to rely on so heavily, but it is having an effect on share prices–and it’s attracting stricter regulations from governments all over the world. If these corporate juggernauts are going to earn back the trust of consumers, shareholders, and policymakers, they need to take serious strides to change how they’re publicly perceived. There are several ways to accomplish this, but it’s going to take a concentrated effort.

Diversity and Representation

First, Silicon Valley has a major diversity problem–and has had one for many years. The overwhelming majority of tech CEOs (and even tech employees) are white men. This is problematic both for the vision and products of the companies and for the reputation of those companies in the general public. Having a leadership team without representation from women and minority groups means your company is less likely to consider the wants, needs, and perspectives of those groups; it’s why we end up with algorithms that discriminate against women and minorities.

There is a fix, though it’s not necessarily a simple one. The most obvious solution is to hire more people from underrepresented groups, but tech companies don’t always have the luxury of having equal or proportional quantities of applicants from each of those groups; in other words, you can’t hire more women if there aren’t many qualified women applying.

So instead of simply adjusting HR practices to hire more applicants who belong to underrepresented demographics, companies need to take part in programs designed to incentivize people from minority groups to pursue careers in tech. As an example, Women in Technology (WiT) programs are becoming more popular, offering mentorship and guidance for young women looking for careers in fields like software engineering, mechanical engineering, or signal processing. Given a few years of development, enough early-stage outreach programs like these could fill the pipelines with more appliances from diverse groups, and slowly change the overall composition of these companies.

Consumer Privacy and Corporate Transparency

Tech companies have also taken a hit on the consumer privacy front, with Facebook showing up in the headlines many times in the wake of the Cambridge Analytica scandal, when it was a London-based political consulting firm was capable of harvesting the personal data of millions of Facebook users for political manipulation purposes. Apple, Amazon, Google, and other companies have also been called to testify in front of a Senate Committee on consumer privacy protections.

We use devices, software, and digital products capable of collecting and storing ridiculous quantities of data on our lives, from where we are at any given time to what we’re talking about in our homes. With opaque and hard-to-understand terms of service agreements and an increasing diversity of connected devices, consumers and policymakers are more concerned than ever that data could be used for nefarious purposes–and tech brands are getting labeled as malicious, data-hungry consumer manipulators, working in darkness to take advantage of us.

There’s no quick fix to this dilemma, but offering more transparency is a good start. Giving users more options when it comes to their privacy, giving them simpler tools so they can truly understand what’s at stake when they use a product or service, and taking accountability when breaches do occur are the only path to restore trust.

Leadership and a Company “Face”

Tech brands also suffer from being faceless, corporate conglomerates. They’re either so massive they don’t have a public face, or their public face seems too detached from reality to seem relatable. Take, for example, Facebook CEO Mark Zuckerberg; this man serves as the “face” of Facebook, but has become generally disliked and distrusted due to his reclusiveness and seemingly robotic disposition when testifying before Congress. Or take Jeff Bezos, who is periodically caricatured as a cartoonish supervillain due to his similarly reclusive nature, his ambition for growth, and his access to practically unlimited resources.

Having a stronger, more trustworthy public face isn’t going to fix everything, but it would give the public someone more relatable to associate with the brand. And it doesn’t have to be a charismatic, charming CEO either–it can be a handful of PR reps or even customer representatives who make consumers feel like there are “real” people behind these companies, instead of just automated tech and reclusive billionaires. It would be a massive investment, to be sure, but it’s one of the only reliable ways to rebuild public trust.

FCC faces tough questions from court on net neutrality repeal

WASHINGTON (Reuters) – A federal appeals court asked pointed questions of the Federal Communication Commission on Friday in hearing a challenge to whether the Trump administration acted legally when it repealed landmark net neutrality rules governing internet providers in December 2017.

FILE PHOTO: The Federal Communications Commission (FCC) logo is seen before the FCC Net Neutrality hearing in Washington February 26, 2015. REUTERS/Yuri Gripas

The panel heard more than four hours of arguments in the first court hearing on the FCC’s controversial decision to reverse the Obama administration’s 2015 rules, which barred internet service providers from blocking or throttling traffic, or offering paid fast lanes, also known as paid prioritisation.

The arguments focussed on how internet providers should be classified under law – either as information service providers as the Trump administration decided or as a public utility, which subjects companies to more rigorous regulations – and whether the FCC adhered to procedural rules in dismantling the Obama-era rules.

“We are creating rules that are built to last,” FCC general counsel Tom Johnson told the U.S. Court of Appeals for the District of Columbia.

Judge Patricia Millett repeatedly pressed Johnson over the FCC’s legal basis for treating telephone calls differently than internet traffic and asked if the FCC had properly considered the public safety impacts.

Millett raised the example of police needing to send urgent photos or video of a suspect that could be delayed if some internet traffic was prioritised.

“We can’t anticipate all harms,” Johnson said. As he sought to play down the concern Millett interjected: “There’s no evidence because they haven’t done it yet.”

In its 2017 decision the Republican-led FCC voted 3-2 along party lines to reverse the net neutrality rules. The agency gave providers sweeping power to recast how users access the internet but said they must disclose any changes in users’ internet access.

The appeals panel is made up of Judges Millet and Robert Wilkins, two appointees of Democratic former President Barack Obama, and Stephen Williams, an appointee of Republican Ronald Reagan.

CHALLENGE FROM STATES, COMPANIES

A group of 22 state attorneys general and the District of Columbia asked the appeals court to reinstate the Obama-era internet rules and to block the FCC’s effort to pre-empt states from imposing their own rules guaranteeing an open internet.

Several internet companies are also part of the legal challenge, including Mozilla Corp, Vimeo Inc and Etsy Inc, as well as numerous media and technology advocacy groups and major cities, including New York and San Francisco.

The challengers also got difficult questions about their legal rationale for seeking reinstatement of the rules.

Kevin Russell, a lawyer for the challengers, said hypothetically an internet provider could now block the Daily Caller website or graphic animal abuse videos as long as they disclosed it.

“We never get a straight answer from the commission whether it thinks blocking and throttling must always be prohibited” or only if it applies to punishing a competitor, Russell said, arguing that the FCC failed to engage in a reasoned analysis and did not properly assess consumer complaints.

Johnson conceded that providers could block or throttle traffic under the FCC rules but said it was unlikely. He said the Federal Trade Commission could take action against anticompetitive conduct.

Millett suggested that under the rules that providers would be free to block pro-Nazi websites or other objectionable content without facing antitrust issues.

The FCC repeal was a win for providers like Comcast Corp, AT&T Inc and Verizon Communications Inc, but was opposed by internet companies like Facebook Inc, Amazon.com Inc and Alphabet Inc.

Major providers have not made any changes in how Americans access the internet since the repeal.

In October, California agreed not to enforce its own state net neutrality law until the appeals court’s decision on the 2017 repeal, and any potential review by the U.S. Supreme Court.

A decision is expected by this summer.

Reporting by David Shepardson; Editing by Frances Kerry

SoftBank's Vision Fund in talks to invest $1.5 billion in Chinese used car platform: sources

HONG KONG/BEIJING (Reuters) – The SoftBank-led Vision Fund is in talks to invest up to $1.5 billion in Chinese used car trading platform Guazi.com, two people with knowledge of the matter said.

That would mark the latest Chinese deal by the mammoth $100 billion investment fund as it looks to expand in the world’s No.2 economy, and would come after it invested 460 million euros in German used car dealing platform Auto1.

The fund is likely to invest up to $1.5 billion in Guazi in a deal that would value the firm at $8.5 billion before the investment, according to one of the sources, who had direct knowledge of the situation.

The two sources, who were not authorized to speak to media, also said the Vision Fund had in the past few months held talks with Guazi’s direct rival, Renrenche, which is backed by Chinese ride-hailing firm Didi Chuxing.

Guazi, a consumer-to-consumer used car trading platform founded in 2014, is backed by Chinese internet giant Tencent and Sequoia Capital China. Its talks with Softbank were first reported by the Financial Times late on Friday.

The Vision Fund and Renrenche declined to comment. Guazi did not respond to a request for comment. Japan’s Softbank was not immediately available for comment.

The Vision Fund, the world’s largest private equity fund after raising more than $93 billion in 2017, has previously made investments in firms such as ride-hailing company Uber Technologies Inc and shared-office space firm WeWork.

China’s used car market has continued to grow even as overall auto sales declined last year for the first time since the 1990s.

Used sales rose 11.5 percent in 2018 from the year before to 13.82 million vehicles. The total value of these transactions was 860.4 billion yuan ($127.61 billion), according to the China Automobile Dealers Association.

China’s state planner has said the country would aim to loosen restrictions on the second-hand auto market, with “appropriate” subsidies provided to boost rural sales of some vehicles.

Reporting by Julie Zhu in Hong Kong and Yilei Sun in Beijing, additional reporting by Junko Fujita in Tokyo; Editing by Joseph Radford

China's Didi sets up JV with BAIC unit to work on NEV projects

FILE PHOTO: A woman walks past a sign of station for Didi Chuxing in Beijing, China January 2, 2019. REUTERS/Jason Lee/File Photo

BEIJING (Reuters) – China’s Didi Chuxing said it had set up a joint venture (JV) with Beijing Electric Vehicle Co., a unit of state-owned BAIC, to work on new energy vehicle and artificial intelligence projects.

The JV, BAIC-Xiaoju New Energy Auto Technology Co. Ltd, aims to develop “next-generation connected-car systems”, Didi, China’s largest ride-hailing operator, said on Monday.

This is the first JV between Didi and state-owned BAIC, which wants to stop selling gas-driven car models by 2025 as China shifts the industry toward new energy vehicles.

The JV comes at a time when China’s market for new energy vehicles (NEVs), a category comprising electric battery cars and plug-in electric hybrid vehicles, is rapidly growing even as the country’s wider auto market cools.

In 2018, car sales in the world’s biggest auto market hit reverse for the first time since the 1990s. But NEV sales were a bright spot, jumping 61.7 percent to 1.3 million units, China’s Association of Automobile Manufacturers has said.

NEV sales in China will hit 1.6 million this year, the industry body estimates.

Didi said there are already 400,000 NEVs registered on its platform through its partnerships with leading electric vehicle makers including BYD.

Didi, whose backers include Uber Technologies Inc, Apple Inc and Japan’s SoftBank Group Corp, is reshuffling its domestic business as it expands globally with new services in South America and Australia.

Reporting by Yilei Sun and Cate Cadell in Beijing; Editing by Himani Sarkar

China's Didi, BAIC set up joint venture to work on NEV projects

FILE PHOTO: A woman walks past a sign of station for Didi Chuxing in Beijing, China January 2, 2019. REUTERS/Jason Lee/File Photo

BEIJING (Reuters) – China’s Didi Chuxing said it had set up a joint venture (JV) with Beijing Electric Vehicle Co., a unit of state-owned BAIC, to work on new energy vehicle and artificial intelligence projects.

The JV, BAIC-Xiaoju New Energy Auto Technology Co. Ltd, aims to develop “next-generation connected-car systems”, Didi, China’s largest ride-hailing operator, said on Monday.

This is the first JV between Didi and state-owned BAIC, which wants to stop selling gas-driven car models by 2025 as China shifts the industry toward new energy vehicles.

The JV comes at a time when China’s market for new energy vehicles (NEVs), a category comprising electric battery cars and plug-in electric hybrid vehicles, is rapidly growing even as the country’s wider auto market cools.

In 2018, car sales in the world’s biggest auto market hit reverse for the first time since the 1990s. But NEV sales were a bright spot, jumping 61.7 percent to 1.3 million units, China’s Association of Automobile Manufacturers has said.

NEV sales in China will hit 1.6 million this year, the industry body estimates.

Didi said there are already 400,000 NEVs registered on its platform through its partnerships with leading electric vehicle makers including BYD.

Didi, whose backers include Uber Technologies Inc, Apple Inc and Japan’s SoftBank Group Corp, is reshuffling its domestic business as it expands globally with new services in South America and Australia.

Reporting by Yilei Sun and Cate Cadell in Beijing; Editing by Himani Sarkar

Who Should Govern Your Data? Inside the Privacy Debate in Davos

Grüezi from the snow-coated Swiss Alps, in whose fir-studded, canvas blanc landscape the World Economic Forum recently transpired.

An inescapable theme at this year’s summit was data privacy. The topic happens, ironically, to play counterpoint to another central theme—that datavore dubbed “artificial intelligence,” as Adam Lashinsky, this newsletter’s regular, weekday author, noted in an earlier column (and elsewhere).

The two concepts are inversely related, a Yin and Yang. Businesses are looking to fill their bellies with as much information as possible, extracting insights that might give them an edge over the competition. Indeed, data-guzzling machine learning processes promise to amplify businesses’ ability to predict, personalize, and produce. But in the wake of a seemingly endless string of data abuses and breaches, another set of stakeholders has grown increasingly vocal about implementing some, let’s call them “dietary restrictions.” Our appetites need limits, they say; left unchecked, the fast-and-loose practices feeding today’s algorithmic models threaten to undermine the autonomy of consumers and citizens everywhere.

The subject of data stewardship clearly occupied the minds of the most powerful politicians in attendance. In the main hall of the forum, two heads of state shared their concerns on Wednesday. Japanese Prime Minister Shinzo Abe said the topic will be one of two primary agenda items for the G20 Summit he is hosting in Osaka in June. (The other is climate change.) Later, German Chancellor Angela Merkel urged Europe to find an approach to data governance distinct from the U.S.’s style, where corporations dominate, as well as the Chinese one, where the state seeks total control.

While policy-makers leaned, unsurprisingly, toward lawmaking, some members of the business set countered their notions with alternative views. Jack Ma, Alibaba’s founder, cautioned against regulation, arguing that it restricts innovation. During a panel on digital trust I moderated on Thursday, Rod Beckstrom, the former CEO of ICANN, an Internet governance group, argued that Europe went astray when it adopted the General Data Protection Regulation, or GDPR, last year, and he advised against the U.S. pursuing a similar path. Instead, Beckstrom proposed adding a privacy-specific amendment to the U.S. Constitution, one separate from the Fourth Amendment’s guard against warrantless searches and seizures. A provocative, if quixotic, idea.

By all measures, the disruptive, data-centric forces of the so-called fourth industrial revolution appear to be outpacing the world’s ability to control them. As I departed Davos, a conference-sponsored shuttle in which I was seated careened into a taxi cab, smashing up both vehicles. (No major injuries were sustained, so far as I could tell; though two passengers visited the hospital out of an abundance of caution.) While waiting in the cold for police to arrive and draw up a report, I was struck by how perfectly the incident encapsulated the conversations I had been observing all week.

We are all strapped, inextricably, to a mass of machinery, hurtling toward collision. Now what must be done is to minimize the damage.

A version of this article first appeared in Cyber Saturday, the weekend edition of Fortune’s tech newsletter Data Sheet. Sign up here.

How to Write Emails That Super Busy People Will Actually Read

Apart from traffic, stubbed toes and spoiled milk, there are few things in life more frustrating or discouraging than cold email outreach. More often than not, you’ll either rejected outright or receive no response at all.

These outcomes become even more likely when reaching out to key decision makers, public figures or any other busy person?, with no reply almost being a guarantee. Yet, while getting a hold of high-profile people is difficult?–?whether they’re the top influencers in your industry or the publisher you’ve been trying to connect with for years?–it certainly isn’t impossible. 

In fact, by applying a handful of simple, battle-tested tips and strategies to your outreach emails and messages, your chances of reaching your prospect will sky rocket.

Here are six of them.

1. Get to the point.

A friend of mine who worked in the sales department at Oracle showed me the sales template they typically use for cold outreach. To my surprise, it was only four sentences long. The same was true for a buddy of mine who works in sales at a well-known Fortune 500 company.

In short, these emails have a quick intro, a sentence explaining why they’re reaching out to the target, a blurb on the value their product or service can bring to their business and wraps up with a question asking to hop on a quick phone call, with a few suggested days and times included.

This was a game-changer for me. Before seeing these templates, I felt compelled to close the deal all within the email itself. Instead, by waiting to do the “selling” on your initial phone call, once you’ve built trust and rapport, my average response rates increased threefold.

2. Prove your the “real deal” right off the bat.

One of my most successful email campaigns (in terms of open rates) included my title as an Inc.com Columnist in the email subject line itself, and read: “Quick Question From an Inc.com Columnist”.

No matter if you’re a CEO of a fast-growing startup, an author or someone who’s just getting started, we all have something of value to offer, some form of social proofing, so be sure to make it known right away.

Additionally, include a link to what I call your “home run proof point”. If you’re a blogger trying to get on a top notch publication, this could be an article that drove a ton of comments and shares. By proving you’re not just another spammer, you’ll instantly start to build trust between you and the prospect. 

3. Personalize it.

Remember: busy people are always on the prowl for reasons not to respond to an unsolicited pitch. 

Did this cold email get my name wrong? Is this cold email relevant to my business at all? Was this cold email clearly copy and pasted?

If there’s any semblance of you not doing your due diligence when it comes to research, editing and more, your chances of getting a response are close to nothing. 

The solution? Show you did your homework by personalizing and tailoring your message to fit specifically to the person you’re reaching out to.

4. Timeliness and relevance is key.

Wherever possible, be sure to include some sort of relevant reason as to why you’re reaching out to the person. 

Has your target recently published a book, secured venture capital or received a noteworthy award? Then congratulate them on it. Show them you care. This will warm them up and increase the chance they’re more receptive to what you’re proposing.

5. Self-serving people finish last.

This might be the most important point of all?–?stay out of it. Meaning, make the email and the reason you’re reaching out all about the contact person. Make sure it’s crystal clear how taking the action with what you’re proposing will add nothing but value to their lives. 

No matter how busy a person is, if there’s enough value at stake, they’ll make the time to respond.

6. Make the options simple.

Within consumer psychology, a common practice to drive customers to take action is to eliminate the number of options they can make in the first place. The same applies to email outreach. By decreasing the number of decisions your target has to make, they’ll be more likely to make the leap.

Is your call-to-action hopping on Skype? Then use a tool like Calendly to eliminate any back-and-forth and streamline the scheduling process.

Is your call-to-action subscribing to your newsletter? Then link it, in bold, at the bottom of your email. 

Getting no response from a noteworthy person can get discouraging?–?believe me, I’ve been there. Yet, by applying the tips laid out in this article to your outreach, you’ll dramatically increase the chances of reeling them in. Best of luck.

The Pitfalls of Facebook Merging Messenger, Instagram, and WhatsApp Chats

In an effort led by CEO Mark Zuckerberg, Facebook has plans to rearchitect WhatsApp, Instagram direct messages, and Facebook Messenger so that messages can travel across any of the platforms. The New York Times first reported the move Friday, noting also that Zuckerberg wants the initiative to “incorporate end-to-end encryption.” Melding those infrastructures would be a massive task regardless, but designing the scheme to universally preserve end-to-end encryption—in a way that users understand—poses a whole additional set of critical challenges.

As things stand now, WhatsApp chats are end-to-end encrypted by default, while Facebook Messenger only offers the feature if you turn on “Secret Conversations.” Instagram does not currently offer any form of end-to-end encryption for its chats. WhatsApp’s move to add default encryption for all users was a watershed moment in 2016, bringing the protection to a billion people by flipping one switch.

Facebook is still in the early planning stages of homogenizing its messaging platforms, a move that could increase the ease and number of secured chats online by a staggering order of magnitude. But cryptographers and privacy advocates have already raised a number of obvious hurdles the company faces in doing so. End-to-end encrypted chat protocols ensure that data is only decrypted and intelligible on the devices of the sender and recipient. At least, that’s the idea. In practice, it can be difficult to use the protection effectively if it’s enabled for some chats and not for others and can turn on and off within a chat at different times. In attempting to unify its chat services, Facebook will need to find a way to help users easily understand and control end-to-end encryption as the ecosystem becomes more porous.

“The big problem I see is that only WhatsApp has default end-to-end encryption,” says Matthew Green, a cryptographer at Johns Hopkins. “So if the goal is to allow cross-app traffic, and it’s not required to be encrypted, then what happens? There are a whole range of outcomes here.”

WhatsApp users, for example, can assume that all of their chats are end-to-end encrypted, but what will happen in Facebook’s newly homogenized platform if an Instagram user messages a WhatsApp user? It’s unclear what sort of defaults Facebook will impose, and how it will let users know whether their chats are encrypted.

Facebook can also glean more data from unencrypted chats and introduce monetizable experiences like bots into them. The company has had a notoriously hard time earning revenue off of WhatsApp’s 1.5 billion users, in part because of end-to-end encryption.

“We want to build the best messaging experiences we can; and people want messaging to be fast, simple, reliable and private,” a Facebook spokesperson said in a statement on Friday. “We’re working on making more of our messaging products end-to-end encrypted and considering ways to make it easier to reach friends and family across networks. As you would expect, there is a lot of discussion and debate as we begin the long process of figuring out all the details of how this will work.”

Facebook emphasizes that this gradual process will allow it to work out all the kinks before debuting a monolithic chat structure. But encryption’s not the only area of concern. Privacy advocates are concerned about the potential creation of a unified identity for people across all three services, so that messages go to the right place. Such a setup could be convenient in many ways, but it could also have complicated ramifications.

In 2016, WhatsApp started sharing user phone numbers and other analytics with Facebook, perforating what had previously been a red line between the two services. WhatsApp still lets users make an account with only a phone number, while Facebook requires your legal name under its controversial “real name” policy. The company maintains this rule to prevent confusion and fraud, but its rigidity has caused problems for users who have other safety and security reasons for avoiding their legal or given name, such as being transgender.

In a Wall Street Journal opinion piece on Thursday evening, Zuckerberg wrote that, “There’s no question that we collect some information for ads—but that information is generally important for security and operating our services as well.” An indelible identity across Facebook’s brands could have security benefits like enabling stronger anti-fraud protections. But it could also unlock an even richer and more nuanced user data trove for Facebook to mine, and potentially make it harder to use one or more of the services without tying those profiles to a central identity.

“The obvious identity issue is usernames. I’m one thing on Facebook and another on Instagram,” says Jim Fenton, an independent identity privacy and security consultant. “In some ways, having the three linked more closely together would be good because it would make it more transparent that they are connected. But there are some Instagram and WhatsApp users who don’t want to use Facebook. This might be seen as a way to try to push more people in.”

Such a change to how chat works on the three brands isn’t just a potentially massive shift for users—it also seems to have stirred deep controversy within Facebook itself, and may have contributed to the departure last year of WhatsApp cofounders Jan Koum and Brian Acton.

End-to-end encryption is also difficult to implement correctly, because any oversight or bug can undermine the whole scheme. For example, both WhatsApp and Facebook Messenger currently use the open-source Signal protocol (used in the Signal encrypted messaging app), but the implementations are different, because one service has the encryption on by default and the other doesn’t. Melding these different approaches could create opportunities for error.

“There’s a world where Facebook Messenger and Instagram get upgraded to the default encryption of WhatsApp, but that probably isn’t happening,” Johns Hopkins’ Green says. “It’s too technically challenging and would cost Facebook access to lots of data.”

And while end-to-end encryption can’t solve every privacy issue for everyone all the time anyway, it’s harder to know how to take advantage of it safely when a service doesn’t offer it consistently, and creates potential privacy issues when it centralizes identities.

“I think they can work this out,” Fenton says. “The bigger problem in my opinion is user confusion.”


More Great WIRED Stories

Zuckerberg to integrate WhatsApp, Instagram and Facebook Messenger: NYT

(Reuters) – Facebook Inc Chief Executive Mark Zuckerberg is planning to unify the underlying messaging infrastructure of the WhatsApp, Instagram and Facebook Messenger services and incorporate end-to-end encryption into these apps, the New York Times reported on Friday.

WhatsApp and Facebook messenger icons are seen on an iPhone in Manchester , Britain March 27, 2017. REUTERS/Phil Noble

The three services will, however, continue as stand-alone apps, the report said, citing four people involved in the effort.

Facebook said it is working on adding end-to-end encryption, which protects messages from being viewed by anyone except the participants in a conversation, to more of its messaging products, and considering ways to make it easier for users to connect across networks.

“There is a lot of discussion and debate as we begin the long process of figuring out all the details of how this will work,” a spokesperson said.

After the changes, a Facebook user, for instance, will be able send an encrypted message to someone who has only a WhatsApp account, according to the New York Times report.

Integrating the messaging services could make it harder for antitrust regulators to break up Facebook by undoing its acquisitions of WhatsApp and Instagram, said Sam Weinstein, a professor at the Benjamin N. Cardozo School of Law.

“If Facebook is worried about that then one way it can defend itself is to integrate those services,” Weinstein said.

But Weinstein said breaking up Facebook is viewed as an “extreme remedy” by regulators, particularly in the United States, so concerns over antitrust scrutiny may not have been a factor behind the integration.

MAJOR TRADEOFFS

Some former Facebook security engineers and an outside encryption expert said the plan could be good news for user privacy, in particular by extending end-to-end encryption.

“I’m cautiously optimistic it’s a good thing,” said former Facebook Chief Security Officer Alex Stamos, who now teaches at Stanford University. “My fear was that they were going to drop end-to-end encryption.”

However, the technology does not always conceal metadata – information about who is talking to whom – sparking concern among some researchers that the data might be shared.

Any metadata integration likely will let Facebook learn more about users, linking identifiers such as phone numbers and email addresses for those using the services independently of each other.

Facebook could use that data to charge more for advertising and targeted services, although it also would have to forgo ads based on message content in Messenger and Instagram.

Other major tradeoffs will have to be made too, Stamos and others said.

Messenger allows strangers to contact people without knowing their phone numbers, for example, increasing the risk of stalking and approaches to children.

Silhouettes of mobile users are seen next to a screen projection of Instagram logo in this picture illustration taken March 28, 2018. REUTERS/Dado Ruvic/Illustration

Systems based on phone numbers have additional privacy concerns, because governments and other entities can easily extract location information from them.

Stamos said he hoped Facebook would get public input from terrorism experts, child safety officers, privacy advocates and others and be transparent in its reasoning when it makes decisions on the details.

“It should be an open process, because you can’t have it all,” Stamos said.

Reporting by Munsif Vengattil in Bengaluru, Jan Wolfe in Washington and Joseph Menn in San Francisco; Writing by Katie Paul; Editing by Tom Brown

Zuckerberg to integrate WhatsApp, Instagram and Facebook Messenger: NYT

(Reuters) – Facebook Inc Chief Executive Mark Zuckerberg is planning to unify the underlying messaging infrastructure of the WhatsApp, Instagram and Facebook Messenger services and incorporate end-to-end encryption into these apps, the New York Times reported on Friday.

WhatsApp and Facebook messenger icons are seen on an iPhone in Manchester , Britain March 27, 2017. REUTERS/Phil Noble

The three services will, however, continue as stand-alone apps, the report said, citing four people involved in the effort.

Facebook said it is working on adding end-to-end encryption, which protects messages from being viewed by anyone except the participants in a conversation, to more of its messaging products, and considering ways to make it easier for users to connect across networks.

“There is a lot of discussion and debate as we begin the long process of figuring out all the details of how this will work,” a spokesperson said.

After the changes, a Facebook user, for instance, will be able send an encrypted message to someone who has only a WhatsApp account, according to the New York Times report.

Integrating the messaging services could make it harder for antitrust regulators to break up Facebook by undoing its acquisitions of WhatsApp and Instagram, said Sam Weinstein, a professor at the Benjamin N. Cardozo School of Law.

“If Facebook is worried about that then one way it can defend itself is to integrate those services,” Weinstein said.

But Weinstein said breaking up Facebook is viewed as an “extreme remedy” by regulators, particularly in the United States, so concerns over antitrust scrutiny may not have been a factor behind the integration.

MAJOR TRADEOFFS

Some former Facebook security engineers and an outside encryption expert said the plan could be good news for user privacy, in particular by extending end-to-end encryption.

“I’m cautiously optimistic it’s a good thing,” said former Facebook Chief Security Officer Alex Stamos, who now teaches at Stanford University. “My fear was that they were going to drop end-to-end encryption.”

However, the technology does not always conceal metadata – information about who is talking to whom – sparking concern among some researchers that the data might be shared.

Any metadata integration likely will let Facebook learn more about users, linking identifiers such as phone numbers and email addresses for those using the services independently of each other.

Facebook could use that data to charge more for advertising and targeted services, although it also would have to forgo ads based on message content in Messenger and Instagram.

Other major tradeoffs will have to be made too, Stamos and others said.

Messenger allows strangers to contact people without knowing their phone numbers, for example, increasing the risk of stalking and approaches to children.

Silhouettes of mobile users are seen next to a screen projection of Instagram logo in this picture illustration taken March 28, 2018. REUTERS/Dado Ruvic/Illustration

Systems based on phone numbers have additional privacy concerns, because governments and other entities can easily extract location information from them.

Stamos said he hoped Facebook would get public input from terrorism experts, child safety officers, privacy advocates and others and be transparent in its reasoning when it makes decisions on the details.

“It should be an open process, because you can’t have it all,” Stamos said.

Reporting by Munsif Vengattil in Bengaluru, Jan Wolfe in Washington and Joseph Menn in San Francisco; Writing by Katie Paul; Editing by Tom Brown

U.S. universities unplug from China's Huawei under pressure from Trump

SAN FRANCISCO (Reuters) – Top U.S. universities are ditching telecom equipment made by Huawei Technologies and other Chinese companies to avoid losing federal funding under a new national security law backed by the Trump administration.

FILE PHOTO: Graduates attend commencement at University of California, Berkeley in Berkeley May 16, 2015. REUTERS/Noah Berger/File Photo

U.S. officials allege Chinese telecom manufacturers are producing equipment that allows their government to spy on users abroad, including Western researchers working on leading-edge technologies. Beijing and the Chinese companies have repeatedly denied such claims.

The University of California at Berkeley has removed a Huawei video-conferencing system, a university official said, while the UC campus in Irvine is working to replace five pieces of Chinese-made audio-video equipment. Other schools, such as the University of Wisconsin, are in the process of reviewing their suppliers.

UC San Diego, meanwhile, has gone a step further. The university in August said that, for at least six months, it would not accept funding from or enter into agreements with Huawei, ZTE Corporation (000063.SZ) and other Chinese audio-video equipment providers, according to an internal memo. The document, reviewed by Reuters, said the moratorium would last through February 12, when the university would revisit its options.

“Out of an abundance of caution UC San Diego enacted the six-month moratorium to ensure we had adequate time to begin our assessment of the equipment on campus and to prevent the campus from entering into any agreements that could later be viewed as inconsistent with the NDAA,” UC San Diego spokeswoman Michelle Franklin said in response to Reuters’ questions about the memo.

These actions, not previously reported, signal universities’ efforts to distance themselves from Chinese companies that for years have supplied them with technical equipment and sponsored academic research, but which are now in the crosshairs of the Trump administration.

The moves are a response to the National Defense Authorization Act (NDAA), which President Donald Trump signed into law in August. A provision of that legislation bans recipients of federal funding from using telecommunications equipment, video recording services and networking components made by Huawei or ZTE. Also on the blacklist are Chinese audio-video equipment providers Hikvision, Hytera, Dahua Technology and their affiliates.

U.S. authorities fear the equipment makers will leave a back door open to Chinese military and government agents seeking information. U.S. universities that fail to comply with the NDAA by August 2020 risk losing federal research grants and other government funding.

That would be a blow to public institutions such as the sprawling University of California system, whose state funding has been slashed repeatedly over the last decade. In the 2016-2017 academic year, the UC system received $9.8 billion in federal money. Nearly $3 billion of that went to research, accounting for about half of all the university’s research expenditures that year, according to UC budget documents.

HUAWEI UNDER SIEGE

The new law is part of a broader Trump administration strategy to counter what it sees as China’s growing threat to U.S. economic competitiveness and national security.

The president has slapped tariffs on a slew of Chinese goods and made it tougher for foreign companies to purchase minority stakes in U.S. tech companies, causing Chinese investment in Silicon Valley to plunge.

In addition, Trump last year signed legislation prohibiting the U.S. government from buying certain telecom and surveillance equipment from Huawei and ZTE. And he is considering a similar ban on Chinese equipment purchases by U.S. companies.

At the center of the storm is Huawei, a global behemoth in smartphones and telecom networking equipment. The company’s chief financial officer has been under house arrest in Canada since December for allegedly lying about Huawei’s ties to Iran. Another Huawei employee was arrested this month in Poland on espionage allegations.

Huawei did not respond to a request for comment.

U.S. universities have already felt the sting of Trump’s China policies. The State Department shortened the length of visas for certain Chinese graduate students. And the administration is considering new restrictions on Chinese students entering the United States. Chinese students are by far the largest group of international students in the United States and provide a lucrative source of revenue for universities.

Pressure to dump Huawei and other Chinese telecom suppliers is adding to the strain.

In addition to the University of Wisconsin, a half dozen institutions, including UC Los Angeles, UC Davis and the University of Texas at Austin, told Reuters they were in the process of reviewing their telecommunications equipment, or had already done so and determined they were NDAA compliant.

At Stanford University, Steve Eisner, the director of export compliance, told Reuters the school did a “scrub” of the campus, but “luckily” did not find any equipment that needed to be removed.

But for Stanford and other academic institutions, Huawei is more than an equipment vendor. Huawei participates in research programs, often as a sponsor, at dozens of schools, including UC San Diego, the University of Texas, the University of Maryland and the University of Illinois Urbana-Champaign.

In addition to an explicit equipment ban, the NDAA calls for creating regulations that would limit research partnerships and other agreements universities have with China. The law requires the Secretary of Defense to work with universities on ways to guard against intellectual property theft and create new regulations aimed at protecting academics from exploitation by foreign countries. Universities that fail to comply with those rules risk losing Defense Department funding.

UC San Diego highlighted this section of the law in a campus newsletter in September.

Fears of a more rigorous crackdown from Washington would seem to be justified. In June, 26 members of Congress sent a letter to Education Secretary Betsy DeVos, sounding an alarm over Huawei’s research partnerships with more than 50 U.S. universities that “may pose a significant threat to national security.”

The lawmakers called on DeVos to require universities to turn over information on those agreements.

Separately, a White House report from June points to a research partnership on artificial intelligence between UC Berkeley and Huawei as a potential opening for China to gather intelligence that could serve Beijing’s military and strategic ambitions. That partnership started in 2016.

“COOLING” RELATIONS WITH HUAWEI

UC Berkeley spokesman Dan Mogulof said the university does not participate in research involving trade secrets. He said the school only enters research partnerships whose findings can be published publicly. Such open-source research is not subject to federal regulations.

Mogulof said UC Berkeley has no plans to change any of the research partnerships it has with Huawei. The company is involved in at least five UC Berkeley research initiatives, including autonomous driving, augmented reality and wireless technology, in addition to artificial intelligence.

Slideshow (3 Images)

Still, a person with knowledge of the matter said the university’s relationship with Huawei had “cooled,” and that some Berkeley researchers are choosing not to proceed with their research agreements with the company to avoid scrutiny from university and government officials.

The chill is spreading. The United Kingdom’s Oxford University this month cut ties with Huawei, announcing it would no longer accept funding for research or philanthropic donations.

“The decision has been taken in the light of public concerns raised in recent months surrounding UK partnerships with Huawei,” a university spokesman said in a statement.

Reporting by Heather Somerville and Jane Lanhee Lee; Editing by Greg Mitchell and Marla Dickerson

Google, Facebook spend big on U.S. lobbying amid policy battles

SAN FRANCISCO (Reuters) – Alphabet Inc’s Google disclosed in a quarterly filing on Tuesday that it spent a company-record $21.2 million on lobbying the U.S. government in 2018, topping its previous high of $18.22 million in 2012, as the search engine operator fights wide-ranging scrutiny into its practices.

FILE PHOTO – The outside of the Google offices is seen in Manhattan in New York City, New York, U.S., January 18, 2019. REUTERS/Mike Segar

In its filing to Congress on Tuesday, Facebook Inc disclosed that it also spent more on government lobbying in 2018 than it ever had before at $12.62 million. That was up from $11.51 million a year ago, according to tracking by the nonpartisan Center for Responsive Politics.

Google’s spent $18.04 million on lobbying in 2017, according to the center’s data.

Google and Facebook declined to comment beyond their filings.

U.S. lawmakers and regulators have weighed new privacy and antitrust rules to rein in the power of large internet service providers such as Google, Facebook and Amazon.com Inc. Regulatory backlash in the United States, as well as Europe and Asia, is near the top of the list of concerns for technology investors, according to financial analysts.

Microsoft Corp spent $9.52 million on lobbying in 2018, according to its disclosure on Tuesday, up from $8.5 million in 2017 but below its $10.5 million tab in 2013.

Apple Inc spent $6.62 million last year, compared to its record of $7.15 million in 2017, according to center data going back to 1998.

Apple and Microsoft did not respond to requests to comment. A filing from Amazon was expected later on Tuesday.

Google disclosed that new discussion topics with regulators in the fourth quarter included its search technology, criminal justice reform and international tax reform. The company is perennially among the top spenders on lobbying in Washington along with a few cable operators, defense contractors and healthcare firms.

Google Chief Executive Sundar Pichai, who testified in December before a U.S. House of Representatives panel for the first time, has said the company backs the idea of national privacy legislation. But he has contested accusations of the company having a political bias in its search results and of stifling competition.

Susan Molinari, Google’s top U.S. public policy official, stepped down to take on an advisory role this month.

Facebook said discussing “election integrity” with national security officials was among its new lobbying areas in the fourth quarter. The filing said the company continued to lobby the Federal Trade Commission, which is investigating its data security practices.

Reporting by Paresh Dave; Additional reporting by Diane Bartz in Washington; Editing by Bill Berkrot and Sonya Hepinstall

Glassdoor Just Announced the 50 Best Jobs in America for 2019 (Is Your Job on the List?)

Some of the highlights in the 2019 best jobs rankings include:

  • A red-hot tech job — Data Scientist — takes the #1 spot

  • #1 most in-demand bob: Software Engineer (#10) with 49,007 open jobs.

  • Twenty-two jobs are new to the list this year, including Security Engineer (#17), Recruiter (#28), and Brand Manager (#48).

According to Amanda Stansell, Glassdoor economic research analyst, the results point out some important trends. Says Stansell:

“As we look closer at the Best Jobs in America for 2019, we’re seeing continued demand for highly-skilled workers, especially in tech and health care roles. Paired with today’s tight labor market, this demand heightens competition among employers to recruit and retain top-performing talent. This is why we’re seeing more employers across industries invest in workplace culture, transparent communication with senior leadership, clear career mobility and attractive compensation packages in order to keep employees satisfied in their jobs long-term.”

Here’s Glassdoor’s list of the 50 Best Jobs in America for 2019. Is your job on it?

1. Data Scientist
Number of Job Openings: 6,510
Median Base Salary: $108,000

2. Nursing Manager
Number of Job Openings: 13,931
Median Base Salary: $83,000 

3. Marketing Manager
Number of Job Openings: 7,395 
Median Base Salary: $82,000  

4. Occupational Therapist
Number of Job Openings: 17,701
Median Base Salary: $74,000

5. Product Manager
Number of Job Openings: 11,884
Median Base Salary: $115,000

6. Devops Engineer
Number of Job Openings: 4,657
Median Base Salary: $106,000

7. Program Manager
Number of Job Openings: 14,753
Median Base Salary: $87,000

8. Data Engineer
Number of Job Openings: 4,739
Median Base Salary: $100,000

9. HR Manager
Number of Job Openings: 3,908 
Median Base Salary: $85,000 

10. Software Engineer
Number of Job Openings: 49,007 
Median Base Salary: $104,000 

11. Mechanical Engineer
Number of Job Openings: 5,949  
Median Base Salary: $75,000  

12. Physician Assistant
Number of Job Openings: 9,819   
Median Base Salary: $105,000  

13. Sales Manager
Number of Job Openings: 21,695 
Median Base Salary: $65,000  

14. Sales Engineer
Number of Job Openings: 3,145 
Median Base Salary: $90,000  

15. Operations Manager
Number of Job Openings: 18,311  
Median Base Salary: $68,000  

16. Strategy Manager
Number of Job Openings: 2,783   
Median Base Salary: $140,000  

17. Security Engineer
Number of Job Openings: 4,683    
Median Base Salary: $102,000 

18. Construction Manager
Number of Job Openings: 3,334   
Median Base Salary: $75,000 

19. Speech Language Pathologist
Number of Job Openings: 29,467    
Median Base Salary: $72,000 

20. Project Manager
Number of Job Openings: 30,107  
Median Base Salary: $75,000 

21. Product Designer
Number of Job Openings: 2,158   
Median Base Salary: $100,000 

22. Java Developer
Number of Job Openings: 6,636  
Median Base Salary: $85,000 

23. Executive Assistant
Number of Job Openings: 4,858  
Median Base Salary: $60,000 

24. Electrical Engineer
Number of Job Openings: 7,191  
Median Base Salary: $77,000 

25. Finance Manager
Number of Job Openings: 3,747  
Median Base Salary: $118,000 

26. Business Analyst
Number of Job Openings: 13,340   
Median Base Salary: $72,000 

27. Solutions Architect
Number of Job Openings: 6,969    
Median Base Salary: $127,000 

28. Recruiter
Number of Job Openings: 9,782     
Median Base Salary: $48,000 

29. Business Development Manager
Number of Job Openings: 6,348    
Median Base Salary: $80,000 

30. Dental Hygienist
Number of Job Openings: 2,805   
Median Base Salary: $67,250  

31. Data Analyst
Number of Job Openings: 5,456  
Median Base Salary: $60,000

32. Nurse Practitioner
Number of Job Openings: 18,997   
Median Base Salary: $102,000

33. Applications Engineer
Number of Job Openings: 2,591   
Median Base Salary: $77,000

34. QA Manager
Number of Job Openings: 1,923  
Median Base Salary: $91,250 

35. Risk Manager
Number of Job Openings: 3,924 
Median Base Salary: $100,500 

36. Communications Manager
Number of Job Openings: 2,009 
Median Base Salary: $80,000 

37. Physical Therapist
Number of Job Openings: 34,899 
Median Base Salary: $70,000 

38. Facilities Manager
Number of Job Openings: 3,472 
Median Base Salary: $65,000  

39. Systems Engineer
Number of Job Openings: 16,793  
Median Base Salary: $90,000  

40. Customer Success Manager
Number of Job Openings: 2,601  
Median Base Salary: $65,000 

41. Radiologic Technologist
Number of Job Openings: 6,115 
Median Base Salary: $48,000

42. Restaurant Manager
Number of Job Openings: 21,754  
Median Base Salary: $49,000  

43. Software Engineering Manager
Number of Job Openings: 1,445 
Median Base Salary: $153,000  

44. Software Developer
Number of Job Openings: 11,833  
Median Base Salary: $80,000 

45. Safety Manager
Number of Job Openings: 2,180   
Median Base Salary: $71,000  

46. UX Designer
Number of Job Openings: 3,333    
Median Base Salary: $89,000   

47. Office Manager
Number of Job Openings: 18,681     
Median Base Salary: $42,000  

48. Brand Manager
Number of Job Openings: 1,500      
Median Base Salary: $85,000   

49. Software Development Manager
Number of Job Openings: 1,178      
Median Base Salary: $140,000    

50. Systems Administrator
Number of Job Openings: 8,278   
Median Base Salary: $68,000     

An Astonishing 773 Million Records Exposed in Monster Breach

There are breaches, and there are megabreaches, and there’s Equifax. But a newly revealed trove of leaked data tops them all for sheer volume: 772,904,991 unique email addresses, over 21 million unique passwords, all recently posted to a hacking forum.

The data set was first reported by security researcher Troy Hunt, who maintains Have I Been Pwned, a way to search whether your own email or password has been compromised by a breach at any point. (Trick question: It has.) The so-called Collection #1 is the largest breach in Hunt’s menagerie, and it’s not particularly close.

The Hack

If anything, the above numbers belie the real volume of the breach, as they reflect Hunt’s effort to clean up the data set to account for duplicates and to strip out unusable bits. In raw form, it comprises 2.7 billion rows of email addresses and passwords, including over a billion unique combinations of email addresses and passwords.

The trove appeared briefly on MEGA, the cloud service, and persisted on what Hunt refers to as “a popular hacking forum.” It sat in a folder called Collection #1, which contained over 12,000 files that weigh in at over 87 gigabytes. While it’s difficult to confirm exactly where all that info came from, it appears to be something of a breach of breaches; that is to say, it claims to aggregate over 2,000 leaked databases that contain passwords whose protective hashing has been cracked.

“It just looks like a completely random collection of sites purely to maximize the number of credentials available to hackers,” Hunt tells WIRED. “There’s no obvious patterns, just maximum exposure.”

That sort of Voltron breach has happened before, but never on this scale. In fact, not only is this the largest breach to become public, it’s second only to Yahoo’s pair of incidents—which affected 1 billion and 3 billion users, respectively—in size. Fortunately, the stolen Yahoo data hasn’t surfaced. Yet.

Who’s Affected?

The accumulated lists seem designed for use in so-called credential-stuffing attacks, in which hackers throw email and password combinations at a given site or service. These are typically automated processes that prey especially on people who reuse passwords across the whole wide internet.

The silver lining in Collection #1 going public is that you can definitively find out if your email and password were among the impacted accounts. Hunt has already loaded them into Have I Been Pwned; just type in your email address and keep those fingers crossed. While you’re there you can also find out how many previous breaches you’ve been a victim of. Whatever password you’re using on those accounts, change it.

Have I Been Pwned also introduced a password-search feature a year and a half ago; you can just type in whatever passwords go with your most sensitive accounts to see if they’re out in the open. If they are, change them.

And while you’re at it, get a password manager. It’s well past time.

How Serious Is This?

Pretty darn serious! While it doesn’t appear to include more sensitive information, like credit card or Social Security numbers, Collection #1 is historic for scale alone. A few elements also make it especially unnerving. First, around 140 million email accounts and over 10 million unique passwords in Collection #1 are new to Hunt’s database, meaning they’re not just duplicates from prior megabreaches.

Then there’s the way in which those passwords are saved in Collection #1. “These are all plain text passwords. If we take a breach like Dropbox, there may have been 68 million unique email addresses in there, but the passwords were cryptographically hashes making them very difficult to use,” says Hunt. Instead, the only technical prowess someone with access to the folders needs to break into your accounts is the ability to scroll and click.

And lastly, Hunt also notes that all of these records were sitting not in some dark web backwater, but on one of the most popular cloud storage sites—until it got taken down—and then on a public hacking site. They weren’t even for sale; they were just available for anyone to take.

The usual advice for protecting yourself applies. Never reuse passwords across multiple sites; it increases your exposure by orders of magnitude. Get a password manager. Have I Been Pwned integrates directly into 1Password—automatically checking all of your passwords against its database—but you’ve got no shortage of good options. Enable app-based two-factor authentication on as many accounts as you can, so that a password isn’t your only line of defense. And if you do find your email address or one of your passwords in Have I Been Pwned, at least know that you’re in good company.


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